fresh, chilled or frozen vegetables with no differentiation in rate between the three designated conditions; nor is there a distinction in classification of the vegetables provided for in subpart B and designated as "Vegetables, Dried, Desicated, or Dehydrated." Subpart C covers vegetables packed in salt, in brine, pickled or otherwise prepared or preserved, while subpart D provides for mushrooms and truffles, fresh, dried or otherwise prepared or preserved. There is, for the most part, a distinction in classification under subparts C and D depending upon the designated condition of the vegetables involved. Insofar as vegetables are concerned, at least for tariff purposes, there would appear to be no distinction between fresh, chilled or frozen. This may very well be due to the numerous decisions involving frozen and blanched products which Congress was presumed to be aware at the time of the enactment of the Tariff Schedules of the United States. The re-enactment of the identical language providing for mushrooms in the Tariff Acts of 1922, 1930, and the Tariff Schedules of the United States is an indication of the lack of distinction between fresh and frozen mushrooms.

The question of blanching was considered by this court as an essential step in the process of freezing and thus not a process which would render the vegetables prepared or preserved. Border Brokerage Company, Inc. v. United States, 60 Cust. Ct. 487, C.D. 3437, 284 F. Supp. 806 (1968), involving blanched frozen vegetable greens and North Pacific Canners and Packers v. United States, 64 Cust. Ct. 551, C.D. 4034 (1970), involving blanched frozen onions. These cases in addition to determining that blanching did not place the vegetables in the category of prepared or preserved also held the freezing likewise did not place them in said category.

The most frequently cited cases on the question of whether freezing constitutes preserving are John A. Conkey & Co. v. United States, 16 Ct. Cust. Appls. 120, T.D. 42766 (1928); United States v. Conkey & Co., 12 Ct. Cust. Appls. 552, T.D. 40783 (1925); and Moscahlades Bros. v. United States, 6 Ct. Cust. Appls. 399, T.D. 35973 (1915).

In the Moscahlades case, certain fish roe which was classified as preserved under paragraph 216, Tariff Act of 1913, was held not to be preserved when it is salted enough to preserve it in the winter but not during the summer. The application of natural or artificial cold to arrest decomposition during the various weather changes does not constitute preservation.

In United States v. Conkey & Co. (T.D. 40783), supra, frozen lamb was classified as fresh lamb under the provisions of paragraph 702, Tariff Act of 1922, and claimed to be properly subject to classification as meats, prepared or preserved, under paragraph 706 of said act.

The court therein concisely set forth in its headnotes the principles involved in that case which are as follows:

It is the common acceptance of the word "preserved," when applied to meat, that it has been so processed that its preservation is of permanent character. This court, and other courts, have frequently held that articles of importation, referred to in the tariff statutes as preserved, have had something more done to them to preserve them than merely to arrest change and decomposition while in transit. So frozen meat is not "preserved" within the meaning of that term in paragraph 706, tariff act of 1922.

When used in the tariff acts, the word "prepared" is sometimes used synonymously with preserved, but, in a general sense, it implies that the fresh or raw material has undergone certain mechanical changes, such as cutting, slicing, grinding, mashing, mixing, etc., and usually implies that it has been advanced toward the condition in which it is used, and frequently such preparation either aids or accomplishes preservation. Frozen meat can not be regarded as "prepared," within the meaning of that word in paragraph 706, tariff act of 1922.

From the foregoing, it is well established by judicial interpretation that neither blanching, which is merely a necessary step for freezing, nor the freezing itself, which is not permanent, constitutes preparation or preservation. Accordingly, blanched frozen mushrooms are not for tariff purposes prepared or preserved.

In an action such as this, the plaintiff has a twofold burden of negating the classification and establishing the correct classification. While plaintiff has established certain differences in the use of frozen mushrooms compared to fresh mushrooms, it has failed to establish its claimed classification. The modern trend for frozen foods does, in my opinion, emphasize the distinction between fresh and frozen foods. However, the remedy for such a situation is legislative and not judicial. The court can only interpret the law as written.

A further indication that the claimed classification is erroneous is the rate of duty assessed by the tariff schedules. The specific rate of 3.2 cents per pound is on the "drained weight." This language appears to have been adopted for the first time with respect to mushrooms in the Tariff Act of 1930. The Supplement to Tariff Information on Items in Tariff Bill of 1930, which was compiled by the Tariff Commission, and printed for the use of the Finance Committee, United States Senate and the Committee on Ways and Means, House of Representatives (1930), makes the following comment at page 333:

Rates and comment.-In the Senate bill mushrooms were given a compound rate of 10 cents per pound plus 45 per cent ad valorem, the "10 cents per pound" to be assessed under the "drained weight" in the case of canned mushrooms. The drained weight of a can of mushrooms is just half the entire weight of the contents, since by universal commercial practice one-half of a can of mushrooms is

liquid and one-half mushrooms. Ten cents per pound on the drained weight is, therefore, equivalent to 5 cents per pound on the entire contents.

Mushrooms shrink approximately 50 per cent in canning, so that 1 pound of fresh mushrooms is required to make one-half pound of canned mushrooms (drained weight).

It is therefore apparent that the term "prepared or preserved" mushrooms in the Tariff Act of 1930 covered only canned mushrooms. The utilization of this language in the Tariff Schedules of the United States must be presumed to be the same. Where there is no liquid to be drained in frozen mushrooms, such provision is not applicable. In view of the foregoing, I find for defendant. Judgment will be entered accordingly.

(C.D. 4402)

CASAVANT FRERES, LTD. v. UNITED STATES

Pipe organs and parts

EXPORT VALUE CUSTOM CONSTRUCTION-DELIVERED AND INSTALLED PRICES

Pipe organs and parts manufactured in and exported from St. Hyacinthe, Canada, were appraised upon entry at the port of Detroit, Mich., on the basis of export value as defined in 19 U.S.C.A. § 1401a (b) at values which included installation costs and transportation to destination charges. And it is claimed by the importer that the organs and parts should be reappraised under the export value basis at values which exclude said costs and charges.

Held, the unique character of the pipe organs as marketed, with their installation mandatorily and inextricably tied to their sale, precludes ascertainment of uniform prices or values in the principal market of the country of exportation, and the record presents no evidence on which any statutory basis of value can be sustained; therefore, plaintiff has not overcome the presumption of correctness attaching to the findings of the district director.

Reappraisement Nos. R70/8253, R70/8254, and R70/8255

Entered at Detroit, Mich.

Entry Nos. 160870, 165005, and 166345.

(Decided January 23, 1973)

Barnes, Richardson & Colburn (Joseph Schwartz of counsel) for the plaintiff. Harlington Wood, Jr., Assistant Attorney General (Jordan J. Fiske, trial attorney), for the defendant.

RICHARDSON, Judge: The merchandise of these consolidated actions consists of two complete pipe organs in knocked-down condition and

521-122-743

the major parts of a third pipe organ in such knocked-down condition which were manufactured by the plaintiff in St. Hyacinthe, Canada; imported into the United States by truck through the port of Detroit, Michigan, and appraised at varying amounts. Plaintiff pleads two causes of action in its complaint. In its first cause of action plaintiff alleges that the proper basis for determining the dutiable value and the resulting value of the involved organs and parts is constructed value as defined in 19 U.S.C.A., section 1401a (d) (section 402(d), Tariff Act of 1930, as amended by the Customs Simplification Act of 1956) at amounts differing from and lower than the appraised values to the extent of certain installation costs and freight-to-destination charges said to be included in the appraised values.

Under its second cause of action plaintiff contends for the same unit values it sought under its first cause of action, but in accordance with the export value basis as defined in 19 U.S.C.A., section 1401a (b) (section 402 (b), Tariff Act of 1930, as amended by the Customs Simplification Act of 1956), provided, however, that constructed value is not the proper basis for determining the value of the involved merchandise. Under this cause of action the defendant has admitted in its answer that the subject merchandise was appraised on the basis of export value.

At the trial, plaintiff abandoned its claim of constructed value. Evidence presented by the plaintiff at the trial under its claim of export value disclosed that the involved organs and parts were constructed pursuant to written contracts which were negotiated by plaintiff with religious institutions in the United States. The record shows that in all of these contracts the prices included installation expenses, transportation charges to the construction site, and customs duties. Eugene Laplante, plaintiff's secretary, testified on direct examination that the plaintiff is engaged in the business of designing, constructing, and installing custom-built pipe organs for clients who are mostly churches and institutions of learning (R.12-13). He testified (R.13-14):

Q. Will you tell us what procedures are followed by your company in obtaining orders or in making sales of pipe organs?A. Yes. Usually, we get a letter of inquiry from a church or institution asking us to provide information on our product. And we send out literature on the Casavant organ and offer our services for designing an instrument which would be appropriate for their situation. From then on very often we have local representatives who serve as agents between our company and the client.

Q. Do your clients sign contracts before you proceed any further with the work?-A. Yes.

Q. At what stage are contracts signed?-A. When the most important details have been established we prepare a contract for the purchaser's signature.

On cross-examination the witness testified that he prepared the contracts in the three cases before the court. And in the case of the organ involved in Court No. R70/8253 the sale came about as a result of contact made by an architect who approached the plaintiff asking it to design an instrument which would be adequate for a building about to be erected (R. 37). The witness also testified (R. 40-41):

Q. During the period of importation of these three organs were all organs sold by Casavant Freres to the United States importers sold with an installation mandatory in the contract?-A. Yes.

Q. And it was also mandatory for the purchaser to pay for this installation?-A. It was.

Q. Again, Mr. Laplante, if you would refer to the three contracts here, they call for Casavant to deliver these organs to the buyer in the United States?-A. Yes; they do.

Q. Does the contract bind the purchaser to pay for the cost of that transportation?-A. Yes; it does.

Q. And this particular facet of the contract, was this a part of all contracts made between Casavant and the United States purchasers at the time of exportation?-A. Yes.

The testimony of plaintiff's witness, Jean-Guy Roy, who is plaintiff's comptroller, detailed the actual costs of installation and transportation which were charged against each of the three importations involved in this case.

It is the plaintiff's contention in this action that the installation and freight charges are not properly part of dutiable export value because, as plaintiff's witness Laplante put it, "when the installation is carried out the organ has already been constructed" (R. 35), and "then it is delivered, so the freight cannot be part of the construction cost." (R. 36.) And defendant contends in substance that plaintiff has failed to prove the correct dutiable value of the merchandise.

The court agrees with the defendant's contention. During the relevant period pipe organs manufactured by the plaintiff for exportation to the United States were never sold or offered for sale, f.o.b. St. Hyacinthe, Canada, the principal market, notwithstanding the fact that the involved invoices give an f.o.b. St. Hyacinthe price breakdown. Organs of plaintiff's manufacture are "custom" built and installed. As the reappraising court said on essentially the same facts in Canadian Pipe Organ Company v. United States (Bd. of G. A.), Reappraisement Circular No. 35932 (1925):

The evidence shows that pipe organs are never sold excepting at a delivered and installed price, and that their cost installed varies according to the location of the town, the kind of materials, decoration, and location necessary to make it harmonize with the architecture of the church. It is clear, then, that so far as the evidence in this case is concerned there is no such thing as a market price for what might be called detached pipe organs.