K.S. Venkataramani, Member (T)

1.C/COD/151/89/MAS - In view of the explanation contained in the application for condonation of delay and after hearing the learned Counsel Shri Nankani and the learned S.D.R., the delay is accordingly condoned.

2. Appeal No. C/S22/88/MAS/ & C/16/89/MAS - In these two appeals the same issue namely the import of Hop pellets and whether such imports are eligible under OGL under the Import Policy 1985-88 is involved. They are taken up together for disposal.

3. In Customs Appeal No. 522/88/MAS the appellants MK Fisheries imported a consignment of Hop pellets valued at Rs. 1,08,615.22 for which they filed two Bills of Entry (B/E) on 14-9-1987 in the Cochin Customs House for clearance and claimed that the import of the goods was covered by OGL Appendix 6 Item No. 1 which covers raw material, components, and consumables other than those included in Appendices 2, 3 Part A, 5 and 8. The Customs House, however, was of the view that the imported item namely Hop pellets will be covered by Serial No. 13 in Appendix 2 Part B of the Import Policy 1985-88 which reads "Brewery hops including hop extracts in any form". Hence the import was held to be unauthorised. The Collector of Customs thereafter instituted proceedings which culminated in the order of adjudication dated 10-12-1987 by which he ordered confiscation of the goods levying a fine in lieu of confiscation of Rs. 20,000/. No personal penalty was imposed.

4. In the other appeal (C/16/89/MAS) the appellants namely Metro Exports imported the same goods and filed BE for their clearance on 22-9-1986 and claimed that they were covered by OGL, Appendix 6 item No. 1. The Customs House accepted their claim for clearance of the goods under OGL and the goods were assessed to duty and cleared out of Customs. The Collector of Customs however passed an order under Section 129 (D) (2) of the Customs Act on 15-9-1987 which was also communicated to the appellants M/s Metro Exports on the same day. In this order, the Collector of Customs was of the opinion that the goods imported namely Hop pellets are not covered by item No. 1 of Appendix 6 of the Import Policy Book 1985-88 and it would require a specific licence as the item figures at Serial No. 13 of Appendix 2, part B and in this view of the matter sought review of the order granting clearance of the goods passed by the proper officer. The Collector (Appeals) sent copies of the application for review and the enclosures to M/s Metro Exports, the appellants, calling upon to make their submissions and passed the impugned order dated 18-4-1988 allowing the application for review of the Collector of Customs, Cochin and directed the Department to initiate penal action against the appellants Metro Exports as the goods are not available for auction.

5. Shri S.D. Nankani, the learned Counsel represented both the appellants. It was his contention that Hop pellets are not covered by Serial No.13 of Appendix 2 Part B. On the other hand it was the contention of the appellants that Brewery hops are agricultural produces and Hop pellets are manufactured from Brewery Hops which serve as a raw-material for use in the manufacture of finished product namely Hop Pellets and as such Brewery Hops and Hop Pellets cannot be treated as one and the same. The learned Counsel in this connection referred to the course of production chart enclosed with the Appeal showing the process of raw hops into Hop Pellets after various process. In fact, according to the learned Counsel, the Collector's order itself contains the observation that "Hop is a plant and which is processed into form of powder and pellets and extracts". Even in the trade parlance, the two products are different according to the appellants. Further, it was contended that in the description given against Serial No. 13 of Appendix 2 Part B the words "in any form" relate to Hop extracts and not Brewery hops. It was argued that processed product like Hop pellets would not be covered by