Import licence classification of machinery knives as tools, not spares, and redemption fine reduced as excessive.

Imported fly knives and dead knives for use in a duplex sheet cutter were treated as tools, not spares, because the tariff classification and the relevant import policy entry specifically described them as tools; the broader policy definition of parts did not extend to tools. On that basis, the goods were held outside the import licence. The confiscation was upheld, but the redemption fine was found excessive in light of the importers' earlier permission to import similar goods as spares and their bona fide belief, so the fine was substantially reduced.

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Issues: (i) whether fly knives and dead knives imported for use in a duplex sheet cutter were spares covered by the import licence or tools falling outside the licence, and (ii) whether the redemption fine imposed on confiscation was excessive.

Issue (i): whether fly knives and dead knives imported for use in a duplex sheet cutter were spares covered by the import licence or tools falling outside the licence.

Analysis: The goods were classified under Heading 82.08 of the Customs Tariff Act as tools. The corresponding entry in Appendix 3 also described them as tools. The definition of parts in the policy covered components, spares and accessories, but not tools. The interpretative rule in Chapter 22 of the policy gave precedence to the specific generic description in Appendix 3. On that basis, the imported items were treated as tools and not spares covered by the licence.

Conclusion: The imported knives were not spares and were not permissible under the licence.

Issue (ii): whether the redemption fine imposed on confiscation was excessive.

Analysis: The importers had earlier been permitted to bring in similar goods as spares and had imported the present goods under that belief. In those circumstances, the fine imposed at about 100% of the value was considered excessive.

Conclusion: The redemption fine was reduced.

Final Conclusion: The confiscation was upheld, but the redemption fine was substantially reduced.

Ratio Decidendi: Where imported goods are specifically classified as tools in the tariff and import policy, they cannot be treated as spares merely because they are used in machinery, and the redemption fine must be proportionate to the circumstances of import.

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