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HQ 955654

May 26, 1994

CLA-2 CO:R:C:T 955654 CMR

CATEGORY: CLASSIFICATION

TARIFF NO.: 5209.12.0020, 5209.19.0060,

District Director
U.S. Customs Service
200 East Bay Street
Charleston, South Carolina 29401-2611

RE: Protest and Application for Further Review 1601-93-100362; Notices of Redelivery; classification of woven fabric dyed with a fugitive dye; NYRLs 880714 and 883670

Dear Ms. Pollock:

This is in response to the protest filed by Sharretts, Paley, Carter & Blauvelt (hereinafter Sharretts), on behalf of their client, against your issuance of Notices of Redelivery for certain 100 percent cotton fabric entered by their client as yarn dyed woven fabric.

FACTS:

Customs issued Notices of Redelivery to Sharretts' client for four entries of certain 100 percent cotton fabric entered as yarn dyed woven fabric of subheadings 5209.43.0020, Harmonized Tariff Schedule of the United States Annotated (HTSUSA), and 5209.49.0090, HTSUSA. These subheadings provide for cotton woven fabrics, containing 85 percent or more by weight of cotton, weighing more than 200 grams per square meter, of yarns of different colors:

5209.43.0020--other fabrics of 3-thread or 4-thread twill, including cross twill, not napped

5209.49.0090--other fabrics, other.

The Notices of Redelivery were issued after Customs determined that the warp yarns of the fabrics contained in the entries were dyed with a fugitive dye. This fact was revealed as a result of various actions. On October 7, 1993, Customs made a request for information and a sample from one of the entries. On November 1, 1993, the requested sample was received in one of the -2-
laboratories of the Customs Office of Laboratory and Scientific Services. The report on the sample was issued on November 30th. On November 5, 1993, counsel from Sharretts and their client met with Customs personnel at the Port of Charleston. At that meeting, we understand that the port was informed that the fabric which is now the subject of the redelivery notices was dyed with a fugitive dye. The importer and its counsel maintains that this meeting was prompted by the discovery of NYRL 880714 of January 19, 1993, by the importer's Charleston customs broker and the broker notifying the importer of this ruling in October 1993. In NYRL 880714, a similar fabric dyed with a fugitive dye was classified as a bleached woven fabric. Prior to notification of NYRL 880714, the importer was importing its fabric based upon its own ruling letter issued by Customs, NYRL 883670 of March 11, 1993. Upon realization of the conflicting, or apparently conflicting rulings, the importer notified its counsel and met with Customs.

A few days after the November 5th meeting, the redelivery notices were issued on November 9th and 10th. The notices were issued based upon the classification of the subject fabric and the requirement of new visas, different from those presented at entry, as a result of this classification. You believe the goods are classified as unbleached woven fabric. Your basis for this position includes, among other things, the definitions contained in Subheading Note 1 of Section XI, HTSUSA, including the definitions for colored yarns and unbleached yarns; NYRL 880714 of January 19, 1993; and, the Harmonized Commodity Description and Coding System Explanatory Notes.

The counsel for the importer argues that the fabrics at issue were properly classified at entry, i.e., that use of a fugitive dye does not preclude classification of fabric as "of yarns of different colors." It is argued that Customs is misreading the definition contained in Subheading Note 1, Section XI, for colored yarns. The importer's counsel also urges that the importer be allowed to rely upon NYRL 883670, issued on his goods, for shipments ordered and in transit and those which already had arrived at the port prior to the importer's discovery of a conflicting ruling on similar goods, i.e., NYRL 880714.

We have been informed by the importer's counsel that one entry is no longer at issue as a new visa was presented for the goods. These goods were classified by you in 5209.19.0060, HTSUSA, and thus required a visa for textile category 219. We have also been informed that a partial redelivery has been made for a second entry at issue.

ISSUE:

What is the proper classification of fabric dyed with a fugitive dye?

May the importer properly rely upon NYRL 883670 which was based upon a submitted fabric sample?

LAW AND ANALYSIS:

Classification of goods under the HTSUSA is governed by the General Rules of Interpretation (GRIs). GRI 1 provides that "classification shall be determined according to the terms of the headings and any relative section or chapter notes and, provided such headings or notes do not otherwise require, according to [the remaining GRIs taken in order]."

Subheading Note 1, Section XI, HTSUSA, provides definitions for various terms which appear within the section. Subheading Note 1(h) defines woven fabric of yarns of different colors, in relevant part, as:

Woven fabric (other than printed woven fabric) which:

(i) consists of yarns of different colors or yarns of different shades of the same color (other than the natural color of the constituent fibers);

(ii) Consists of unbleached or bleached yarn and colored yarn;

Subheading Note 1(d) defines colored (dyed or printed) yarn, in relevant part, as:

Yarn which: (i) Is dyed (whether of not in the mass) other than white or in a fugitive color, or printed, or made from dyed or printed fibers; * * *. [emphasis added].

Subheading Note 1(b) defines unbleached yarn, in relevant part, as:

Yarn which: (i) Has the natural color of its constituent fibers and has not been bleached, dyed (whether or not in mass) or printed; or * * * .

Such yarn may have been treated with a colorless dressing or fugitive dye (which disappears after simple washing with soap) and, in the case of man-made fibers, treated in the mass with delustering agents (for example, titanium dioxide). [emphasis added]

Subheading Note 1(e) defines unbleached woven fabric as:

Woven fabric made from unbleached yarn and which has not been bleached, dyed or printed. Such fabric may have been treated with a colorless dressing or a fugitive dye. [emphasis added]

Counsel for the importer has argued that Customs is misreading the definition of colored yarns and that it should be read to say that colored yarn is yarn which is dyed other than white, or yarn which is dyed in a fugitive color, or yarn which is printed, etc.. We disagree with this interpretation. The view urged by the importer's counsel is in accord with Customs prior practice regarding fugitive dyes under the previous Tariff Schedules of the United States Annotated (TSUSA) and the definition of the term "colored" under the TSUSA as judicially interpreted in C. Tennant Sons & Co. v. United States, 65 Cust. Ct. 445, C.D. 4120 (1970). However, counsel's view is directly contrary to the language of the definition in Subheading Note 1(d) and the definitions in Subheading Notes 1(b) and 1(e). Reading these definitions together, it is clear that unbleached yarn and unbleached fabric dyed with a fugitive dye remain, by definition, unbleached. To adopt the view advocated by counsel would create an irreconcilable inconsistency between the definitions of unbleached yarn and colored yarn, i.e., an unbleached yarn dyed with a fugitive dye would meet both definitions. The proper reading of the language of Subheading Note 1(d) is that colored yarn is, among other things, yarn dyed other than in a fugitive color. This interpretation is consistent with the language and punctuation of Subheading Note 1(d) and is consistent with the other definitions cited above. Therefore, since a yarn dyed with a fugitive dye does not meet the definition of colored yarn in Subheading Note 1(d), woven fabric made with such a yarn cannot be woven fabric of yarns of different colors as defined in Subheading Note 1(h).

In regard to the Customs practice prior to implementation of the present Harmonized Tariff, Customs agrees that under the previous tariff schedule dyeing a fabric with a fugitive dye would cause it to be classified as a "colored" or dyed fabric. C. Tennant Sons & Co., 65 Cust. Ct. 445. However, when the HTSUSA went into effect, simply put, the law changed. The HTSUSA has specific definitions in Subheading Note 1, Section XI, for unbleached, bleached, and colored yarns and fabrics. With the enactment of the HTSUSA, the tariff definitions of the term "colored" changed.

The importer's counsel has argued that her client received a ruling from Customs, NYRL 883670 of March 11, 1993, classifying a sample of fabric as cotton twill blue denim fabric classifiable as "of yarns of different colors" in subheading 5209.42.0020, -5-

HTSUSA, even though the fabric was dyed with a fugitive dye. She urges that her client be allowed to rely upon that ruling up until the time the client realized another ruling existed which appeared to conflict with NYRL 883670.

Section 177.9(b)(1) of the Customs Regulations (19 CFR 177.9)) states, in part, that:

Each ruling letter is issued on the assumption that all of the information furnished in connection with the ruling request and incorporated in the ruling letter, either directly, by reference, or by implication, is accurate and complete in every material respect. [emphasis added].

Customs was not aware of the fact that the submitted fabric was dyed with a fugitive dye at the time the ruling was issued. Counsel has argued her client was not aware the nature of the dye was relevant for classification.

The sample fabric submitted for a ruling and ruled upon in in NYRL 883670 was dyed with a fugitive dye; this material fact was omitted and Customs was unaware of it at the time NYRL 883670 was issued. As Customs was not informed that the fabric sample was dyed with a fugitive dye, it was reasonable for Customs to assume the dye was fast. Customs believes that NYRL 883670 is correct on its face. The ruling states the fabric has warp yarns that have been dyed blue. It does not identify the nature of the dye and it is reasonable to believe that all who read this ruling will assume, as Customs did, that the dye is fast. However, as the ruling was issued based upon a specific sample and that sample was dyed with a fugitive dye, NYRL 883670 will be revoked as the actual facts are materially different from the facts on which the ruling was based.

As the true facts differ in this case from the facts as reasonably believed by Customs in issuing NYRL 883670, no reliance can be placed upon that ruling by the importer. The Customs Regulations provide, in part, at 19 CFR 177.9(c)(2) that:

The modification or revocation of a ruling letter will not be applied retroactively with respect to the person to whom the ruling was issued, or to any person directly involved in the transaction to which that ruling related, Provided:

(i) The request for a ruling contained no misstatement or omission of material facts, * * *. [emphasis added].

As to the argument that the importer did not realize that a material fact was omitted, i.e, that the nature of the dye was -6-
relevant, such argument is more properly directed toward mitigation of possible penalty assessments, not for detrimental reliance.

HOLDING:

The merchandise at issue, fabric containing yarns dyed with a fugitive dye, is not classifiable as woven fabric of yarns of different colors under the HTSUSA. Therefore, as the fabric has one yarn dyed with a fugitive dye and one that is unbleached, the fabric is properly classified as unbleached cotton fabric.

Reliance by the importer upon NYRL 883670 is not a basis for cancelling the protested redelivery notices as NYRL 883670 was issued by Customs without complete knowledge of the true facts, i.e., a material fact was omitted. Although on its face it is accurate, the ruling will be revoked.

The protest of the redelivery notices is denied in full.

In accordance with Section 3A(11)(b) of Customs Directive 099 3550-065, dated August 4, 1993, Subject: Revised Protest Directive, this decision should be mailed by your office to the protestant no later than 60 days from the date of this letter. Sixty days from the date of the decision the Office of Regulations and Rulings will take steps to make the decision available to customs personnel via the Customs Rulings Module in ACS and the public via the Diskette Subscription Service, Lexis, Freedom of Information Act and other public access channels.

Sincerely,

John Durant, Director
Commercial Rulings Division

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See also:

• Tariff No.: 5209.12.00 - Unbleached 3- or 4-thread twill fabrics of cotton, including cross twill, 85 percent or more cotton by weight, weighing more than 200 g/m2
• Tariff No.: 5209.19.00 - Unbleached woven fabrics of cotton, nesoi, containing 85% or more cotton by weight, weighing more than 200g/m2
• Tariff No.: 5209.42.00 - Denim containing 85% or more cotton by weight, weighing more than 200 g/m2, of yarns of different colors
• Tariff No.: 5209.43.00 - 3- or 4-thread twill fabrics of cotton,incl. cross twill, nesoi, 85% or more cotton by wt, weighing ov 200g/m2, of yarns of different colors
• Tariff No.: 5209.49.00 - Woven fabrics of cotton, nesoi, containing 85% or more cotton by weight, weighing more than 200 g/m2, of yarns of different colors