2004 (8) TMI 530 - AT - Customs

Summary

Issues:
1. Assessment of provisional Bills of Entry under Section 18 of the Customs Act, 1962.
2. Eligibility of M/s. PSL Pipe Coates Pvt. Ltd. for duty exemption under Notification No. 208/92.
3. Whether the process of coating pipes amounts to manufacture.
4. Dispute over ownership and entitlement to duty exemption under various notifications.
5. Interpretation of Notification No. 208/92 and its applicability to the case.

Analysis:

1. The Appellate Tribunal considered the provisional assessment of Bills of Entry under Section 18 of the Customs Act, 1962. It was noted that M/s. PSL Pipe Coates Pvt. Ltd. (PSL) filed Bills of Entry on behalf of Oil & Natural Gas Commission of India (ONGC) and cleared pipes to their branded warehouse. The issue arose as to whether PSL, as a coating service provider, was entitled to duty exemption under various notifications.

2. The Commissioner found that PSL was eligible for the benefit of Notification No. 208/92, despite not being the actual importer. The Commissioner determined that PSL fulfilled the conditions for the exemption and that ownership of the goods was not a relevant factor. It was also established that the coating process undertaken by PSL resulted in the manufacture of new products, thus meeting the criteria for duty exemption.

3. The Revenue challenged the Commissioner's findings on various grounds, including the failure to establish claims under Notification No. 208/92 by both parties and the issue of ownership regarding the imported goods. The Revenue contended that the process employed by PSL did not amount to manufacture, questioning the eligibility for duty exemption.

4. Upon thorough consideration, the Tribunal analyzed Notification No. 208/92 and its requirements. It was clarified that the exemption applied to raw materials used in manufacturing processes under Section 65 of the Customs Act, 1962. The Tribunal affirmed that the coating process undertaken by PSL constituted manufacture or other operations permissible under Section 65, entitling them to duty exemption under the notification.

5. The Tribunal dismissed the Revenue's appeal, upholding the Commissioner's order granting duty exemption to PSL under Notification No. 208/92. It was emphasized that the benefit of an alternative notification, if eligible, must be granted, and the approval of the Oil Industry Development Board for other notifications did not affect the eligibility for duty exemption under Notification No. 208/92. The Tribunal affirmed that the Commissioner's decision was valid and the appeal was therefore dismissed.