2013 (4) TMI 654 - AT - Customs

Appellant claimed benefit of Notification 21/2002-Cus on imported goods Rejection of granting the benefit of exemption as the importer did not have a valid contract at the time of importation and he did not satisfy the condition 40(b) stipulated in the said Notification, which stipulates that only a person who has been awarded a contract for the construction of roads in India by a or on behalf of the Ministry of Surface Transport, by the NHAI, by the PWD of a State Government or by a road construction corporation under the control of the Government of a State or Union Territory is eligible for the exemption. Accordingly, the claim of the appellant was rejected and duty demand was confirmed against the appellant. Revenue further points out that Notification 21/2002 was re-issued in the budget 2012 and in the new notification No.12/2012,. Metropolitan Development Authority was also specifically included. Therefore, it is clear that the notification distinguishes between a Metropolitan Development Authority and a Road Construction Corporation. Otherwise, there is no need to use these two expressions specifically and separately and, therefore, he contends that prior to Budget 2012, when Notification No.21/2002 was in force, benefit was not be available in case the contracts for road construction were awarded by MMRDA. Held that - In the light of the notifications issued, we hold that prior to budget 2012, benefit of customs duty exemption on road construction equipment was not available in cases where the contract for such construction was awarded by a Metropolitan Development Authority. Thus the appellant in the present case is not eligible for the benefit of duty exemption under notification No. 21/2002-Cus. Accordingly, we dismiss the appeal as devoid of merits.

Issues Involved:
1. Eligibility for customs duty exemption under Notification 21/2002-Cus.
2. Interpretation of "road construction corporation" in the context of the notification.
3. Applicability of the principle of strict interpretation for exemption notifications.

Issue-wise Detailed Analysis:

1. Eligibility for Customs Duty Exemption under Notification 21/2002-Cus:
The appellant, M/s. Shreeji Construction, imported a 'Hydraulic Piling Rig B 170' and claimed the benefit of Notification 21/2002-Cus (serial No. 230). The customs authorities denied the exemption, stating that the appellant did not satisfy condition 40(b) of the notification, which requires the contract to be awarded by specific authorities such as the Ministry of Surface Transport, National Highway Authority of India, Public Works Department of a State Government, or a road construction corporation under the control of the Government of a State or Union Territory. The appellant's contract was awarded by the Mumbai Metropolitan Regional Development Authority (MMRDA), which was not listed as an eligible authority under the said notification.

2. Interpretation of "Road Construction Corporation":
The appellant argued that MMRDA should be considered a road construction corporation under condition No. 40 of Notification No. 21/2002, as it is a body corporate responsible for regional development, including road construction. The appellant further pointed out the use of the indefinite article "a" before "road construction corporation" in the notification, suggesting that any corporation undertaking road construction should be included.

The Revenue countered that MMRDA is a Metropolitan Regional Development Authority, not a road construction corporation. The notification specifically differentiates between a Metropolitan Development Authority and a road construction corporation, as evidenced by the re-issuance of the notification in 2012 (Notification No. 12/2012), which explicitly included "Metropolitan Development Authority" as an eligible authority.

The Tribunal agreed with the Revenue, emphasizing that the notification's language clearly distinguishes between the two entities. The Tribunal noted that if the intention was to include Metropolitan Development Authorities under the term "road construction corporation," the notification would have stated so explicitly.

3. Applicability of the Principle of Strict Interpretation for Exemption Notifications:
The Tribunal referenced the Supreme Court's judgment in Gammon India Ltd. vs Commissioner of Customs, which emphasized that exemption notifications must be construed strictly. The appellant must clearly establish eligibility for the exemption. In this case, the term "road construction corporation" could not be interpreted to include MMRDA, which undertakes various activities beyond road construction.

The Tribunal further applied the principle "Expressio unius est exclusion alterius," meaning the express mention of one thing excludes all others. Since the notification explicitly mentioned "road construction corporation," it excluded other entities not specified, such as MMRDA.

Additionally, the Tribunal considered the legislative intent behind the 2012 amendment, which extended the exemption to contracts awarded by Metropolitan Development Authorities. This extension indicated that prior to the amendment, such authorities were not covered under the exemption.

Conclusion:
The Tribunal concluded that prior to the 2012 amendment, the benefit of customs duty exemption on road construction equipment was not available for contracts awarded by Metropolitan Development Authorities like MMRDA. Therefore, the appellant was not eligible for the exemption under Notification No. 21/2002-Cus, and the appeal was dismissed as devoid of merits.

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