Complete pre-mutilation test for imported rags rejects rigid cut-count norms and unreasonable port restrictions

Import policy requiring woollen rags, synthetic rags and shoddy wool to be in completely pre-mutilated condition cannot be enforced by a rigid cut-count fixed only through a public notice; the operative test is whether the goods are so worn out or soiled that they are beyond cleaning, repair or reuse. A restriction confining import to Bombay and Delhi ICD, while excluding ICD Sanganer, was found unsupported by reasonable and germane grounds and therefore unreasonable on the material considered. The policy was applied subject to the broader mutilation test, and denial of import through ICD Sanganer on that basis was not justified.

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Issues: (i) What is the proper test for determining whether woollen rags, synthetic rags and shoddy wool are imported in "completely pre-mutilated condition"; and whether the customs public notice prescribing a fixed number of cuts was binding. (ii) Whether the restriction permitting import of such goods only through Bombay and Delhi ICD, and not through ICD Sanganer, was arbitrary and unreasonable.

Issue (i): What is the proper test for determining whether woollen rags, synthetic rags and shoddy wool are imported in "completely pre-mutilated condition"; and whether the customs public notice prescribing a fixed number of cuts was binding.

Analysis: The import policy required the goods to be imported in completely pre-mutilated condition and stated that mutilation must conform to the requirements specified by the Customs authorities in their notification. The Court held that the expression could not be reduced to a rigid arithmetical formula of a minimum number of cuts, because no proper notification by the competent customs authority had been shown and a public notice could not be treated as an equivalent statutory notification. The relevant inquiry was whether the goods were so worn out or soiled that they were beyond cleaning or repair and incapable of being reused as garments or cloth.

Conclusion: The fixed-cut norms in the public notice were held inapplicable, and the respondents were directed to apply the broader test of complete mutilation stated by the Court.

Issue (ii): Whether the restriction permitting import of such goods only through Bombay and Delhi ICD, and not through ICD Sanganer, was arbitrary and unreasonable.

Analysis: The power to impose conditions on import could be exercised only on sound and germane grounds. The Court found that the restriction to two ports ignored the actual facilities, practical convenience, transportation burden, congestion at Bombay, and the availability of clearance facilities at ICD Sanganer. In the circumstances, the restriction was not justified on the material before the Court and operated unreasonably against the petitioners.

Conclusion: The port restriction was held arbitrary and unreasonable, and import through ICD Sanganer could not be denied on that basis.

Final Conclusion: The writ petitions succeeded in part: the impugned mutilation norms were invalidated, the port restriction was struck down, and the petitioners were entitled to import through ICD Sanganer subject to the test laid down in the judgment.

Ratio Decidendi: Where an import policy requires goods to be imported in completely pre-mutilated condition, the standard cannot be enforced by a rigid, non-statutory cut-count fixed through a mere public notice; the governing test is whether the goods are in substance beyond cleaning, repair, or reuse, and import restrictions must be supported by reasonable and non-arbitrary grounds.

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