Packing material is not a consumable under import policy; tissue paper for leather footwear wrapping was denied Open General Licence clearance.

Tissue paper imported for wrapping leather footwear did not qualify as raw material or consumable under Appendix 10(1) of the 1982-83 Import and Export Policy because packing material does not participate in the manufacturing process or form part of the finished product. The claim that it served as a cushioning layer was unsupported by technical evidence, and prior policy concessions were irrelevant. The redemption fine was also left undisturbed, with the Tribunal noting that such fine is ordinarily linked to the profit margin on the goods and finding no basis for interference.

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Issues: Whether tissue paper imported for wrapping leather footwear fell within Appendix 10(1) of the April 1982 - March 1983 Import and Export Policy as raw material or consumable eligible for clearance under the Open General Licence, and whether the redemption fine was excessive.

Analysis: The imported tissue paper was admittedly used as wrapping or packing material for leather footwear. Packing material, by its nature, could not be treated as a raw material for the manufacture of the finished product. The definition of consumable in Paragraph 5(12) of Chapter 2 of the policy required the item to participate in or be required for the manufacturing process without forming part of the end product, and tissue paper used only for wrapping did not satisfy that test. The plea that it was used as a cushioning layer was unsupported by technical material and was not established on the record. The Tribunal also found no relevance in concessions given in earlier policy years. On the question of fine, the Tribunal accepted that redemption fine is ordinarily fixed with reference to the profit margin on the goods and found no basis to interfere.

Conclusion: The tissue paper was not covered by the Open General Licence under Appendix 10(1), and the confiscation and redemption fine were upheld.

Final Conclusion: The appeal failed on merits and the impugned order of the customs authorities was sustained.

Ratio Decidendi: Goods used only as wrapping or packing material for the finished product do not qualify as raw materials or consumables under an import policy that restricts those expressions to items used in or forming part of the manufacturing process.

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