Returnable bobbins and customs drawback: mere unwinding of yarn did not amount to use, so the higher drawback rate applied.

Returnable bobbins imported with nylon yarn were treated as containers or receptacles for packing, and merely unwinding the yarn to remove its contents did not amount to the bobbins being taken into use. In the absence of any finding that the bobbins themselves were employed in winding or unwinding operations, their use between customs clearance and export was not established. The reduced drawback rate was therefore inapplicable, and drawback was payable at 98% of the duty paid under Section 74 of the Customs Act.

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Issues: Whether returnable bobbins imported along with nylon yarn and used only to unwind the yarn for removal were taken into use between clearance from customs control and export, so as to limit drawback to the reduced rate.

Analysis: The bobbins were treated as containers or receptacles for packing yarn. The process of unwinding the yarn from the bobbins for removing the contents did not amount to using the bobbins in the relevant sense. Mere extraction of the yarn from the imported bobbins, without any allegation or finding that the bobbins themselves were employed for winding and unwinding in the appellants' operations, was insufficient to treat them as having been taken into use.

Conclusion: The bobbins were not taken into use; the grant of drawback at reduced rates was incorrect, and the appellants were entitled to drawback at 98% of the duty paid under Section 74 of the Customs Act.

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