Trade parlance governs woollen rags classification, preventing retrospective notices from defeating import validity and customs exemption.

Woollen rags had to be construed in their trade parlance because no statutory definition was then in force, and later public notices could not be applied retrospectively to earlier shipments. On that basis, the imported goods covered by STC-approved tenders and indents fell within the recognised commercial meaning of woollen rags, so the import control restriction and absolute confiscation were not justified. The same trade meaning governed customs classification and duty, and the non-statutory tariff advice could not override the exemption notification applicable to woollen rags. The goods were therefore entitled to exemption, with the confiscation-related allegations ceasing to survive.

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Issues: (i) Whether the imported goods described as woollen rags were validly imported without contravention of the import control restrictions and the confiscation ordered under the Customs Act was justified. (ii) Whether the goods were liable to customs duty otherwise than in accordance with the exemption notification applicable to woollen rags.

Issue (i): Whether the imported goods described as woollen rags were validly imported without contravention of the import control restrictions and the confiscation ordered under the Customs Act was justified.

Analysis: The governing question was the meaning of woollen rags at the time of import. There was no satisfactory statutory definition then in force, and the later public notices could not be applied retrospectively to shipments already made or arrived. In the absence of a statutory definition, the expression had to be understood in its trade sense. The Board accepted the reasoning that the goods imported against STC-approved tenders and indents fell within the trade understanding of woollen rags, and the departmental insistence on a technical or laboratory approach was not the correct test.

Conclusion: The imports were held to be valid, and the orders of absolute confiscation were set aside.

Issue (ii): Whether the goods were liable to customs duty otherwise than in accordance with the exemption notification applicable to woollen rags.

Analysis: The same trade understanding governed the duty question. The tariff advice relied on by the department was treated as non-statutory and incapable of overriding the absence of a statutory definition. The Board further held that the goods were entitled to the benefit of the relevant customs exemption notification for woollen rags, and the departmental case on higher wool content or a separate classification standard was not accepted. The ancillary allegations under section 111(i) and section 111(m) also did not survive once the confiscation was set aside and the goods were directed to be released subject to mutilation.

Conclusion: The duty liability was held to be governed by the exemption notification applicable to woollen rags, in favour of the assessees.

Final Conclusion: The common trade meaning of woollen rags controlled both import control and customs duty treatment, resulting in relief to the importers with consequential directions for mutilation under supervision.

Ratio Decidendi: In the absence of a statutory definition, a commercial commodity used in import control and customs classification must be construed in its trade parlance, and later executive definitions or non-statutory tariff advice cannot be applied retrospectively to defeat the import or deny the applicable exemption.

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