2011 (3) TMI 177 - AT - Customs

Notification No.21/02-Cus dt.1.3.02 - The benefit of the notification was denied on the ground that the machine in question is capable to perform two functions embroidery and quilting whereas the notification provides exemption for embroidery or quilting machines separately - Circular No.45/98 dt.30.6.98 to say that the exemption is to be granted after taking into consideration the main function of the machine - As the machine having both function embroidery and quilting and further we find that as per Board s clarification main function of the machinery may be considered while granting the benefit of notification - Decided in the favour of the assessee

Summary

Issues:
Import of machine; Benefit of Notification No.21/02-Cus dt.1.3.02; Interpretation of Circular No.45/98; Machine capable of performing two functions - embroidery and quilting; Exemption under the notification; Main function of the machinery for granting benefit; Compliance with the notification requirements.

Analysis:
The case involved an appeal regarding the import of a machine declared as Dolphin Duplex Embroidery and Quilting machine, with the appellant claiming the benefit of Notification No.21/02-Cus dt.1.3.02. The benefit was initially denied on the basis that the machine could perform both embroidery and quilting functions, whereas the notification provided exemption for these functions separately. The appellant argued that the imported machine, capable of both functions, should be entitled to the benefit of the notification. The appellant relied on Circular No.45/98 to support their claim that the exemption should be granted considering the main function of the machine.

The learned SDR, representing the respondent, relied on the lower appellate authority's findings and a previous Tribunal decision to argue against granting the benefit under the notification for a machine performing both embroidery and quilting functions simultaneously. The Tribunal noted that the notification granted exemptions for embroidery and quilting machines separately, but in this case, the machine in question performed both functions. Considering the Board's clarification that the main function of the machinery should be considered for granting the benefit of the notification, the Tribunal held that even if the embroidery function was considered an additional function, the benefit could not be denied.

Ultimately, the Tribunal set aside the impugned order and allowed the appeal, stating that the appellants were entitled to the consequential benefit in accordance with the law. The decision emphasized that the machine's capability to perform both embroidery and quilting functions did not disqualify it from receiving the exemption under the notification, as the main function of the machinery was a crucial factor in determining eligibility for the benefit.