2005 (6) TMI 404 - AT - Customs

Summary

Issues:
1. Waiver of pre-deposit of duty.
2. Denial of benefit of Notification No. 25/2002-Cus. in respect of technology licence fee.
3. Classification of technology licence fee under Chapter 49.
4. Time-bar for demand of duty.
5. Consideration of drawings as part of the machine.
6. Start of limitation period for duty payment.

Analysis:
1. The applicant sought waiver of pre-deposit of duty amounting to Rs. 13,65,279. The duty was confirmed without granting the benefit of Notification No. 25/2002-Cus. for a technology licence fee. The applicant contended that the Customs authorities initially assessed the technology licence fee as part of the machine, despite the applicant claiming classification under Chapter 49 for the fee. The applicant argued that the benefit of the notification cannot be denied now, and the demand is time-barred as the goods were assessed, and a show cause notice was issued without any allegation of suppression.

2. The Revenue opposed the applicant's claim, stating that the drawings should not be considered part of the machine, leading to the denial of the benefit based on the issue of time-bar. The Revenue argued that the limitation period for duty payment starts from the date of actual payment of duty. However, the Tribunal found that the authorities had initially assessed the drawings and design as part of the imported machine, despite the applicant's claim for a different classification under Chapter 49. The Tribunal noted that the applicant had a strong case in their favor, leading to the waiver of the pre-deposit of the entire duty amount for the appeal hearing, and the stay petition was allowed.

3. In conclusion, the Tribunal granted the applicant's request for the waiver of pre-deposit of duty, considering the initial assessment by the authorities and the applicant's classification claim under Chapter 49. The Tribunal found merit in the applicant's argument and allowed the stay petition, indicating a prima facie strong case in favor of the applicant. The judgment highlighted the importance of proper classification and assessment practices by the Customs authorities to ensure the correct application of duty benefits and the timely resolution of disputes related to duty payments and classifications.