2016 (2) TMI 138 - AT - Customs

Import of Weft Straightener Type MDC Machine - concessional rate of duty as per Notification No.21/2002-Cus - It is submitted that in textile technology, Weft Straightening Machine is one system and Calendaring Machine is another system and there is no machine called as Weft Straightening and Calendaring Machine - Held that - the appellants are entitled for the concession of duty in terms of the Notification No.21/2002-Cus for the machine imported by them. - Decided in favor of assessee.

Summary

Issues:
Interpretation of customs duty exemption notification for imported machine description discrepancy.

Analysis:
The case involved an appeal against an order-in-appeal passed by the Commissioner of Customs (Appeals) upholding the order-in-original. The appellant imported a machine described as "Weft Straightener" but was denied concessional duty under Notification No.21/2002-Cus due to a discrepancy in the description compared to the notification. The appellant argued that the imported machine fell within the description of "Weft Straightener and Calendaring Machine" mentioned in the notification. The appellant relied on a certificate from the Textile Commissioner and a precedent to support their claim.

The key issue before the Tribunal was whether the appellant was entitled to the concessional duty under the notification for the imported machine. The appellant contended that there was no combined machine for Weft Straightening and Calendaring, as these processes occurred at different stages in textile processing. The appellant argued that interpreting the notification to cover only a combined machine would render it ineffective, as no such machine existed, thus depriving the textile industry of the benefit. The Tribunal agreed with the appellant's interpretation, emphasizing that exemptions should be construed to advance the purpose of the provisions and not render them meaningless. Citing relevant precedents, the Tribunal concluded that the appellant was entitled to the concessional duty and allowed the appeal, setting aside the impugned order.

In conclusion, the Tribunal ruled in favor of the appellant, holding that the machine imported by them fell within the description specified in the customs duty exemption notification. The Tribunal found that the appellant was entitled to the concessional duty under Notification No.21/2002-Cus, based on the interpretation that a combined Weft Straightening and Calendaring machine did not exist, and the benefit should be available to the textile industry. The appeal was allowed, overturning the previous decision.