Mutaffer and Another v. M. B. Dissanayake (Tan.biah, J.J
MULAFFER AND ANOTHER
COURT OF APPEALATUKORALE. J ANDTAMBIAH JC A. APPLICATION 2000 79SEPTEMBER 29, 1981.
Mandamus – s. 47 of Customs Ordinance – bill ol entr/ – Rules for Interpretation of theSri Lanka Customs Import Tariff – Does footwear include parts of footwear ?
In the tariff headings a clear distinction is made between footwear and parts of footwearHence no occasion arises to call in aid Rule 2(al of the Rules for Interpretation of theSri Lanka Customs Import Tariff The petitioners (importers) had correctly categorisedthe imported consignment under the hpadmg dealing with parts of footwear and giventhe correct part.culars n the bill of «-ntry Hence to insist that the goods are correctlyclassifiable under the heading of footwear so as to attract a heavier duty would amountto a refusal to perform a public duty and mandamus will lie.
Case referred to
ID Wi/eyespknra and Co Ltd. v. The Principal Collector of Customs (195V53 N. L. R. 329
Application for writ of MandamusP Nagendra for bctitioneis
S. W B Waduqodapitlya. Depoty Solicitor General withN. Y Casie Chp»ty State Cci.myp' for respondent
Cur Adv. vult
October 30, 1981
The petitioners carry on business in partnership in Colombo, asan exporter and importer of goods under the name of "MarshallExports and Imports". The respondent is the Principal Collectorof Customs.
In the month of October, 1978, the petitioners placed anorder with Messrs. Zee Trading Company of Singapore for 4,800pairs of plastic soles and 4,800 pairs of plastic straps.'The saidgoods were shipped by Messrs Zee Trading Company on the vessel"Singhe Fortune" which arrived at the Colombo Harbour on 8thDecember, 1978.
Sri Lanka Law Reports
[ 1981)2 S.L.R.
Section 47 of the Customs Ordinance requires an importerto deliver to the Collector a bill of entry setting out, inter alia, thequantity, value and the description of goods. He must also pay anyduties and dues which may be payable upon the goods mentionedin such entry. The bill of entry when signed by the Collector, orperson authorised by him, and transmitted to the proper officer,shall be the warrant to him for the examination and deliveryof such goods.
The import duties payable on footwear and parts of footwearimported into this Country are set out in Chapter 64 of GazetteNo. 298/7 of 6th January, 1978. The duty payable on "Footwearwith outer soles and uppers of rubber or artificial plastic material”is 100% or Rs. 50/- per pair, whichever is higher (Heading No.64.01); on "Parts of footwear (including uppers, insoles andscrew-on heels) of any material except metal," the duty payable is100% of the value of the goods (Heading No. 64.05).
The Bills of Entry were framed by the petitioners on thebasis that the goods imported by them came under HeadingNo. 64.05 and the duty payable was set out as Rs. 34.057/59. TheCustoms authorities however took a different view. A letter dated13th June, 1979 (annexure "X2") signed on behalf of therespondent was sent to the petitioner. It states —
"With reference to the above mentioned importation, I haveto inform you that these goods are correctly classifiable underB. T. N. No. 64.01 dutiable at Rs. 50/- per pair. The totalduty payable on this consignment is Rs. 240,000/ . Accordingto the two bills of entry only a sum of Rs. 34,057/59 has beenentered by you in column 10 of the said entries.
You are hereby requested to take necessary action to pay thecorrect duty of Rs. 240,000/ , in respect of this consignment.
If you fail to pay the correct duty of Rs. 240,000/- withinone month of the receipt of this letter, further action will betaken to deal with this consignment under the provisions ofthe Customs Ordinance."
The 1st petitioner thereupon interviewed the respondentwith his Counsel and thereafter wrote the letter "X3" of 28.6.79requesting the respondent to refer the matter to the Attorney-General for his opinion, since a similar matter was pending beforehim, for his decision. As no reply was received, the 1st petitionerfinally wrote the letter "X4" dated 7.11.79 wherein he stated —
Mulaffer and Another v. M. B. Dissanayake (Tambiah, J.)
"I understand however that I can only clear the goodsspecified above, only on payment of a duty of Rs. 240,000/-as set out in your letter of 13.6.79, and not the duty ofRs. 34,057/59, which I state is the duty due.
I have no alternative therefore but to take legal action toenforce my rights to clear the goods on payment of the dutyof Rs. 34,057/59."
The Gazette contains "Rules for the interpretation of the SriLanka Customs Import Tariff". Rule 1 States —
"The titles of Sections, Chapters and sub-Chapters are provi-ded for ease of reference only; for legal purposes, classificationshall be determined according to the terms of the headings andany relative Section or Chapter Notes and, provided suchheadings or Notes do not otherwise require, according to thefollowing provisions."
Rule 2(a) states
"Any reference in a heading to an article shall be taken toinclude a reference to that article incomplete or unfinished,provided that, as imported, the incomplete or unfinishedarticle has the essential character of the complete or finishedarticle. It shall also be taken to include a reference to thatarticle complete or finished (or falling to be classified ascomplete or finished by virtue of this Rule), imported un-assembled or disassembled."
It is the learned Deputy Solicitor General's contention that byvirtue of the 2nd limb of Rule 2 (a), the article Footwear inHeadinq No. 64.01 includes a reference to that article imported ina complete or finished form and also imported in an unassembledform. In short footwear includes parts of footwear and thereforeattracts the higher rate of duty.
If Rule 2 (a) stood alone, I would have agreed with hiscontention, but regard must be had to Rule 1 which states that forlegal purposes, classification shall be determined according to theterms of the headings etc. and, provided such headings do nototherwise require, according to the following provisions.
Chapter 64 is headed "Footwear, Gaiters and the like;Parts of such articles." Heading No. 64.01 refers to the completeor finished article Footwear; so do Heading Nos. 64.02,
Sri Lanka Las. Repots
64.03 and 64.04. Heading No. 64.05 refers to Parts of Footwear.Thus a clear distinction is made in the Headings between footwearand parts of footwear. The interpretation Rule 2 (a) by which theterm footwear shall be construed to include "parts of footwear"becomes applicable only if the headings "do not otherwise require." The Tariff Headings require that a distinction be drawnbetween footwear and parts of footwear and hence the occasionfor applying Rule 2(a) does not arise. I agree with the submissionof learned counsel for the petitioner that if the tariff headingsonly referred to footwear and made no mention of parts offootwear, then by reason of Rule 2(a), footwear could have beeninterpreted to include parts of footwear. It seems to me thereforethat the imported goods have to be classified under Heading No.64.05 and dutiable at 100% of the value of the goods. The res-pondent has wrongly insisted that the petitioners pay a duty ofRs. 50/- per pair, under Heading No. 64.01.
In Wijeyesekera & Co. Ltd. v. The Principal Collector ofCustoms the Company was an exporter of coconut oil and othercommodities. In regard to a consignment of oil in October, 1950,the Company was compelled by the Customs authorities tosubmit a bill of entry in contravention of the provisions of s. 59 ofthe Customs Ordinance (now s. 57). The section requires theexporter to submit a bill of entry setting out various particulars,including an accurate specification of the quantity, quality andvalue of such goods. The exporter was also required to pay theduties and dues which may be payable of the goods mentioned insuch entry. Upon payment the bill of entry is signed by theCollector and the goods are passed for shipment. Where for techni-cal reasons, it is difficult to assure that the quantity shipped willcorresppnd with the quantity intended to be shipped, an alter-native procedure was available to the exporter in terms of the rulespassed under the Ordinance. In such an event, pending the ascer-tainment of the exact quantity, the exporter may deposit a sum ofmoney which the Customs authorities assess as more than suffi-cient to cover the duty payable on the consignment. Thereafter,the true quantity shipped is measured, and a correct bill of entryprepared and signed. The exporter is entitled to recover any excessduty paid. The Company was required to deposit, in terms of therule, a sum which was 25% in excess of the estimated duty, and atthe same time was called upon to prepare arrd sign in advance a billof entry on the assumption that the quantity passed for shipmentwould exceed by 25% the quantity of the intended cargo. TheCompany signed the bill of entry, under protest.
Gratiaen J. observed (p. 332) –
Mulaffer dtid Another v. M. B Dissanayake tTambiah. Jj
"Admittedly, the respondent is charged with a public dutyunder section 59 of the Customs Ordinance to accept inproper form a bill of entry tendered by an exporter and con-taining true particulars as to the quantity, value, etc., of theintended consignment. It necessarily follows that to insistupon the bill of entry being incorrectly filled up in such amanner that, upon the face of the document, the exporterwould be liable to pay a heavier export duty han was justlydue, would amount to a refusal to perform , ubl'c djty. Inthat event, a mandamus would clearly lie."
in the present case, in the bills of entry, 'h.- ueutioners havecorrectly categorised the imported consignment Lnder HeadingNo. 64.05. For the respondent to insist that the goods arecorrectly classifiable under Heading No. 64 01 and that thepetitioners should pay the heavier import diry, "would amountto a refusal to perform a public duty". The pmuioners are entitledto a Mandamus to compel the respondent > accept the dutypayable in terms of Heading No. 64.05 an* *o permit them toclear the goods on payment of the said duty.
The Application is allowed. The respor ant will pay to thepetitioners Rs. 525/- as costs.
Atukorale, J. I agree