Sample import claims require contemporaneous proof, and breach of the value ceiling makes the entire import unauthorised.

A claimed sample import under the REP licence scheme required contemporaneous proof that the goods were genuinely imported for sample purposes; correspondence here referred only to electronic items and auto parts, and no material showed a bona fide purpose for importing a complete Honda car as a sample, so the facility under paragraph 146 was unavailable. The policy also imposed a Rs. 50,000 value ceiling requiring prior endorsement where the limit was exceeded; because no prior endorsement was sought, Customs could not condone only the excess value and the import was treated as unauthorised in full.

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Issues: (i) Whether a Honda motor car could be imported as a sample against REP licence under paragraph 146 of the Import Policy AM 1981-82; (ii) Whether, when the value exceeded Rs. 50,000, the excess value alone could be condoned or adjudicated by Customs authorities.

Issue (i): Whether a Honda motor car could be imported as a sample against REP licence under paragraph 146 of the Import Policy AM 1981-82

Analysis: The facility for importing samples under paragraph 146 depended not merely on the absence of an express exclusion of motor cars, but on the importer establishing a genuine claim that the goods were in fact imported as samples for the stated purpose. The correspondence with the licensing authority referred only to electronic items and automobile parts such as pistons, piston rings, valves and gaskets, and did not disclose any prior claim or clarification for importing a complete motor car as a sample. The ordering correspondence with the supplier also showed a firm order for a complete Honda car without wheels and tyres, but no contemporaneous material showed that it was meant to study, develop, or manufacture a similar product. The burden to prove bona fide import as sample was therefore not discharged.

Conclusion: The claim that the motor car was imported as a sample was not established and the import could not avail the facility under paragraph 146.

Issue (ii): Whether, when the value exceeded Rs. 50,000, the excess value alone could be condoned or adjudicated by Customs authorities

Analysis: Paragraph 146 imposed a value ceiling of Rs. 50,000 and required prior endorsement by the licensing authority through the prescribed channel where the value exceeded that limit. The appellants did not seek such endorsement before import, even though the value had already crossed the limit. The value restriction was treated as mandatory and not as a curable irregularity to be left to Customs for condonation of only the excess. Since the licensing authority was kept out of the scrutiny envisaged by the policy, the entire import was unauthorised.

Conclusion: The excess value could not be condoned by Customs and the whole import was liable to be treated as unauthorised.

Final Conclusion: The import was held to be outside the sample-import facility under the policy, absolute confiscation and penalty were sustained, and the appeal failed.

Ratio Decidendi: A claimed sample import under an import policy must be proved by contemporaneous material establishing bona fide purpose, and where the policy prescribes a value ceiling with prior endorsement for excess value, non-compliance renders the import unauthorised in its entirety.

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