1998 (10) TMI 506 - AT - Customs

Summary

Issues:
1. Import of spare parts from a different country than permitted under the license.
2. Interpretation of the license regarding the country of origin for imported spare parts.

Issue 1 - Import of spare parts from a different country:
The case involved the importation of spare parts of a printing machine by the appellants, which were confiscated due to being imported from a country different from what was allowed under their license. The license permitted the import of machines from either the U.K. or West Germany. The appellants imported spares from West Germany for a machine originally of West German origin but imported from the U.K. The Revenue contended that spares for the U.K. machine should also be from the U.K., leading to a dispute. The appellants argued that there was no restriction in the license on the country of origin for spare parts and that the machine in question was of West German origin, just imported from the U.K. The Tribunal agreed with the appellants, setting aside the confiscation and allowing the appeal.

Issue 2 - Interpretation of the license regarding spare parts:
The learned Advocate for the appellants argued that the license allowed the import of spare parts for the printing machines up to 10% of their CIF value without specifying a country restriction. The license mentioned specific countries for different machines but did not impose a similar restriction for spare parts. The Advocate highlighted that the machine in question, although imported from the U.K., was of West German origin, justifying the import of West German spare parts. The Tribunal, after considering the arguments, agreed with the interpretation provided by the Advocate and set aside the impugned order, granting relief to the appellants.

In conclusion, the Appellate Tribunal CEGAT, New Delhi, in this judgment, addressed the issue of importing spare parts from a different country than permitted under the license. The Tribunal analyzed the license terms and the origin of the machines to determine the validity of importing spare parts from West Germany for a machine originally of West German origin but imported from the U.K. The Tribunal sided with the appellants, setting aside the confiscation and allowing the appeal based on the absence of a specific country restriction for spare parts in the license and the origin of the machine in question.