2003 (1) TMI 752 - AT - Customs

Summary

Issues involved:
- Interpretation of Notification No. 32/97-Cus dated 1.4.1997 for exemption from duty on imported goods for jobbing.

Detailed Analysis:

1. Issue of Benefit of Notification No. 32/97-Cus:
The appeal involved the question of whether M/s. Bholanath International Ltd. was eligible for the benefit of Notification No. 32/97-Cus dated 1.4.1997 for goods they imported. The appellant claimed exemption under this notification for importing fabrics to edge jute carpets for export. The dispute arose as the Asst. Commissioner and Commissioner (Appeals) denied the benefit, stating that the appellant's activity did not fall within the scope of jobbing as per the notification's conditions.

2. Arguments and Interpretation of 'Jobbing':
The appellant's advocate argued that the appellant's activities constituted jobbing as defined in the EXIM policy, involving processing or working on raw materials supplied by foreign customers for export purposes. The advocate contended that the Supreme Court's interpretation in a Central Excise matter was not directly applicable to customs matters, especially when jobbing was defined in the EXIM Policy. The advocate also cited a judgment highlighting the importance of interpreting terms based on context.

3. Counter-arguments and Legal Precedents:
The SDR countered by stating that the appellant's activity did not meet the criteria of jobbing, as they procured the carpets locally and the edging work did not involve a significant contribution of labor or skill. Referring to a previous judgment, the SDR emphasized that job work should involve work done for hire or profit, with minor additions not changing the nature of the work. The SDR argued that the Supreme Court's interpretation in an excise matter could be applied to customs matters as well.

4. Judgment and Decision:
The Tribunal analyzed the facts and agreement between the parties, concluding that the appellant's activities did not align with the definition of jobbing under the notification. The Tribunal found that the appellant's procurement of carpets locally and edging them with fabric supplied by foreign customers did not meet the criteria of jobbing for duty exemption. Referring to a previous decision's interpretation of job work, the Tribunal held that the appellant's actions did not comply with the notification's conditions, as the basic fabric of the carpet was not imported. Consequently, the appeal was rejected.

In conclusion, the Tribunal upheld the decision denying the benefit of Notification No. 32/97-Cus to M/s. Bholanath International Ltd., emphasizing the importance of meeting the specific criteria outlined in the notification for duty exemption on imported goods for jobbing purposes.