Import licence scope for torque wrenches narrowed, while confiscation stood but excessive redemption fine was set aside.

Pneumatically operated torque wrenches could not be brought within a permissive import licence entry for "hand tools" where the evidence did not establish that the consignment was covered as torque wrenches, and the relevant tariff setting treated such tools differently from ordinary hand tools. The licence requirement was therefore upheld. Confiscation of the goods was also sustained, but the redemption fine was found excessive because prior clearances of identical goods under similar licences, together with the absence of any trade notice or other warning, supported the importer's bona fides. The fine was set aside and any amount paid was directed to be refunded.

---

---

Issues: (i) Whether the imported torque wrenches were covered by the import licence and could be treated as hand tools or torque wrenches under the relevant import policy entries; (ii) whether the confiscation of the goods and the redemption fine imposed in lieu of confiscation were justified.

Issue (i): Whether the imported torque wrenches were covered by the import licence and could be treated as hand tools or torque wrenches under the relevant import policy entries.

Analysis: The goods were described in the invoice as Impactool, and the evidence produced did not satisfactorily establish that the consignment was in fact torque wrenches within the specific permissive entry. The expression "hand tools" was not defined in the policy, and the classification under Heading 84.49 of the Customs Tariff Act showed that pneumatic tools for working in the hand were treated differently from ordinary hand tools. In that statutory setting, the permissive entry for hand tools could not be stretched to cover pneumatically operated tools merely because they were held in hand.

Conclusion: The imported goods were not proved to be covered by the licence as torque wrenches or hand tools, and the finding that they required a specific licence was upheld against the assessee.

Issue (ii): Whether the confiscation of the goods and the redemption fine imposed in lieu of confiscation were justified.

Analysis: Although confiscation was sustained, the authorities had themselves accepted that earlier clearances of identical goods under similar licences had guided the importers. No subsequent public notice or trade notice had been shown to have alerted the trade to a different position, and no material contradicted the bona fides of the import. In those circumstances, the imposition of a fine close to the full value of the goods was held to be harsh and unwarranted.

Conclusion: Confiscation was confirmed, but the redemption fine was set aside and any fine paid was directed to be refunded to the assessee.

Final Conclusion: The assessee failed on the licensing and confiscation issue, but succeeded in getting the redemption fine annulled, resulting in only partial relief.

Ratio Decidendi: Pneumatically operated tools classified in tariff law as machinery cannot be treated as ordinary hand tools for import-policy entitlement, and even where confiscation is sustained, redemption fine must be proportionate and may be interfered with where bona fide import and prior clearances are established.

---