2006 (3) TMI 418 - AT - Customs

Summary

Issues:
1. Interpretation of Notification No. 1/95-C.E. regarding exemption eligibility for imported goods described as 'Components of Computer Workstation' in CKD condition.
2. Consideration of whether goods described as 'Wooden furniture' in the invoice are entitled to the exemption under the relevant Notification.
3. Assessment of the retrospective effect of subsequent Notification No. 40/2000-C.E. on the eligibility for exemption.
4. Evaluation of the certification by the Director of Software Technology Parks of India (STPI) regarding the necessity of the imported goods for software development.

Analysis:
Issue 1: The appeal was filed against an order passed by the Commissioner of Customs (Appeals), Bangalore, regarding the entitlement of goods procured by a 100% EOU, described as 'Components of Computer Workstation' in CKD condition, to exemption under Notification No. 1/95-C.E. The Revenue argued that since the goods were described as 'Wooden furniture' in the invoice, they were not eligible for the exemption. The original authority and the Commissioner (Appeals) upheld this view. However, the advocate for the appellants contended that the goods were Capital Goods and therefore entitled to the exemption under Annexure-1 to Notification 1/95, even before the subsequent Notification No. 40/2000. The tribunal, citing relevant case law, held that the goods were indeed eligible for the exemption as Office Furniture/Capital Goods under Notification No. 1/95.

Issue 2: The contention regarding the description of the goods as 'Wooden furniture' in the invoice was addressed by the tribunal in light of the certification by the Director of STPI that the imported goods were necessary for software development. Additionally, the CT-3 Certificate issued by the department supported the appellant's claim for exemption. The tribunal found that the goods were procured based on proper documentation and certification, making them eligible for the benefit of the exemption notification.

Issue 3: The tribunal considered the argument regarding the retrospective effect of Notification No. 40/2000-C.E. and concluded that since the impugned goods were covered by Notification No. 1/95 as Office Furniture/Capital Goods, they were entitled to the benefit of the exemption, irrespective of the subsequent notification.

Issue 4: The certification by the Director of STPI played a crucial role in establishing the necessity of the imported goods for software development, further supported by the CT-3 Certificate issued by the department. The tribunal, relying on previous judgments and the proper documentation provided, set aside the impugned order and allowed the appeal, granting the appellants the benefit of the exemption under Notification No. 1/95.