Industrial stapling machine import under REP licence permitted where the machine was used in garment manufacturing and export packing.

An industrial stapling machine imported by a garment manufacturer under an REP licence was held to fall within the Import and Export Policy, 1983-84, because the policy had to be read in light of its export-replenishment object and Appendix 17 expressly permitted industrial stapling machines for garments. The machine was used in the manufacturing process for affixing slips, marking pieces, and sealing or packing garments for export, so its actual use supported classification as industrial for policy purposes. Customs tariff references to office machines and the principal-purpose rule in Note 5 of Chapter 84 did not govern the policy meaning. The Tribunal's contrary view was rejected.

---

---

Issues: Whether the stapling machine HD-10 imported by a garment manufacturer holding an REP licence qualified as an industrial stapling machine permissible under the Import and Export Policy, 1983-84.

Analysis: The policy had to be read with its object in paragraph 128, namely replenishment of materials required in the manufacture of exported products. Appendix 17 specifically permitted industrial stapling machines for garments, and the evidence showed that the imported machine was used in the manufacturing process for affixing slips, marking pieces, and sealing or packing garments for export. The reference in the Customs Tariff to office machines and the principal-purpose rule in Note 5 of Chapter 84 did not control the meaning of industrial stapling machine in the policy context. In the absence of any statutory or policy classification separating industrial and non-industrial staplers, a stapling machine used in the garment manufacturing process was treated as industrial for the purpose of the REP licence.

Conclusion: The imported stapling machine was an industrial stapling machine within Appendix 17 and its import was permissible. The finding of the Tribunal was not justified.

Ratio Decidendi: Where a REP licence permits an industrial stapling machine and the machine is actually used by the exporter-manufacturer in the manufacture and packing of the exported goods, it falls within the permitted import even if the machine also has non-industrial applications.

---