Warehousing permission does not finally ermine licence validity; importer must prove goods fall within the import exception.

Warehousing permission under Section 60 is only a preliminary customs clearance step and does not finally determine whether the import licence covers the goods; that issue may be examined before clearance for home consumption under Section 68. The article further notes that, where an importer seeks to rely on an exception to a general import prohibition, the burden rests on the importer to prove by evidence that the goods fall within the permissive entry. On the facts discussed, the contention that only Section 129D proceedings were available was rejected, while the licence-coverage issue required fresh adjudication.

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Issues: (i) Whether adjudication proceedings could be initiated after the goods had been permitted to be deposited in bond warehousing and whether the matter could be taken only under Section 129D of the Customs Act, 1962. (ii) Whether the imported nylon fabrics were covered by the licence as lining or inter-lining material under the relevant Import Policy.

Issue (i): Whether adjudication proceedings could be initiated after the goods had been permitted to be deposited in bond warehousing and whether the matter could be taken only under Section 129D of the Customs Act, 1962.

Analysis: Permission under Section 60 follows compliance with Section 59 and is concerned with warehousing, not with a final determination on the acceptability of the import licence. The order for clearance of warehoused goods for home consumption under Section 68 is distinct from the warehousing permission, and the question whether the goods are prohibited depends on whether a valid import licence covers them. Acceptance of the licence at the stage of warehousing is only preliminary scrutiny, and the authority may examine the licence validity before clearance for home consumption.

Conclusion: Adjudication proceedings after warehousing were held to be legally maintainable, and the contention that only Section 129D proceedings could be taken was rejected.

Issue (ii): Whether the imported nylon fabrics were covered by the licence as lining or inter-lining material under the relevant Import Policy.

Analysis: The goods were described as inter-lining cloth, but there was no satisfactory documentary evidence showing what had been ordered, the intended end-use, or that the goods answered the specification of lining material falling within the permissive entry. Since man-made fabrics were generally banned and the claim depended on an exception, the appellants had to establish by evidence that the goods fell within that exception. The authority below had not examined the nature of the goods in sufficient depth and the material on record was inadequate for a conclusive finding.

Conclusion: The finding on licence coverage was set aside and the matter was remanded for de novo adjudication.

Final Conclusion: The challenge to the maintainability of adjudication failed, but the classification and licence-coverage issue required fresh consideration, so the order was set aside and the matter was sent back for re-adjudication.

Ratio Decidendi: Warehousing permission does not finally determine licence validity, and where an importer claims the benefit of an exception to a general import prohibition, the burden lies on the importer to establish by evidence that the goods fall within that exception.

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