COLLECTOR OF CUSTOMS AND CENTRAL EXCISE AND ORS.
A
v.
M/S. LEKHRAJ JESSUMAL AND SONS AND ANR.
FEBRUARY 7, 1996
[S.P. BHARUCHA AND B.N. KIRPAL, JJ.]
B
Customs tariff :
Miniaturised switches used in electronic hearing aids-Conventional
wafer switches replaced in the indust1y by newry innovated reed switches and C
are imported-Customs auth01ities holding that these are not entitled to
concessional rate of import duty-High Court reversing the decision-On
appeal, held switches, miniaturised could include reed switches-Progress
cannot be stiffed by an over-rigid interpretation of Import Policy or Customs
tariff-On the date of import both wafer switches and reed switches reasonab-
ly ·covered by the said expression though at the time the policy or tariff was D
formulated, reed switches were not covered.
CIVIL APPELLATE JURISDICTION: Civil Appeal No.1128 of
1982.
From the Judgment and Order dated 12/15.2.82 of the Karnataka E
High Court in W.A. No. 212 of 1982.
Joseph Vellapally and ~.N. Terdol for the Appellants.
K. Ramkumar for the Respondents.
The following Order of the Court was delivered :
The appeal upon certificate impugns a judgment of a Division Bench
of the Karnataka High Court.
F
The respondent had imported miniaturised switches for use in G
electronic bearing aids which it manufactured. It appears that there are
two types of such switches, the conventional one then being wafer switches
and the other, newly innovated, being reed switches. It was the latter type
of switch which was imported. The Customs authorities took the view that
the respondents' import licence did not CO\Zer reed switches and they were H
245
246
SUPREME COURT REPORTS
(1996] 2 S.C.R.
A not entitled to the concessional rate of import duty. The stand or the
customs authorities was, ultimately, assailed in the writ petition filed by the
respondent before the High Court. The Writ petition was allowed. An
appeal was preferred and it is the judgment in appeal which is under
challenge before us.
B
The High Court in the impugned order noted that the stand of the
Customs authorities was that the words "switches, Miniaturised" as com-
ponent parts of hearing aids should be understood to mean only those types
of switches which were generally used in the manufacture of hearing aids
at the time of publication of the Import Policy for the relevant year, namely
C 1977, and that these words could not be said to include any other type of
switch even if such other type of switch could be used in the manufacture
of hearing aids. The Division Bench observed, in our view, very rightly, that
such aµ interpretation over-looked that industry was not static and that
there was continuous technical progress therein. New processes and new
methods developed from time to time and new material and components
D or types of components superseded others. It was unreasonable to give a
static interpretation to words used in a tariff schedule ignoring the rapid
march of technology. Having regard to the technical opinion that reed
switches would improve the performance of hearing aids, the High Court
held that reed switches were covered by the tariff entry. The High Court
E
also noted that it was not the case of the Customs authorities that the
respondent was trying to divert the imported reed switches from the
manufacture of hearing aids to another purpose.
F
We do not think that we can put it better. Progress cannot be stifled
by an over-rigid interpretation of Import Policy or Customs tariff. Both
must be read as they stand on the date of importation and whatever is
reasonably covered thereby must be allowed to be imported regardless of
the fact that it was not in existence or even contemplated when the policy
or tariff was formulated.
G
The appeal is dismissed. The Bank guarantee given by the respon-
dent pursuant to the order of this Court dated 25.3.83 ·shall stand dis-
charged. There shall be. no order as. to costs.
G.N .. ·
Appeal dismissed.
Lex