2007 (4) TMI 231 - SC - Customs

As per Exemption Notification 64/88, the respondent was required to submit a certificate certifying that the machinery (hospital equipment) imported had been installed within a period of two years from the date of import revenue could not rebut the contention of the respondent that they had resubmitted the installation report within two years of the import of the machinery through the State Health Department exemption not deniable revenue appeal dismissed

Summary

Issues:
1. Interpretation of Notification No. 64/88-Cus regarding exemption from duty for hospital equipment.
2. Compliance with conditions of the notification by the respondent.
3. Confiscation of hospital equipment under Section 111(o) of the Customs Act.
4. Imposition of penalty under Sections 112 and 114A of the Customs Act for violating notification conditions.

Interpretation of Notification:
The Supreme Court considered whether the respondent fulfilled the conditions specified in Notification No. 64/88-Cus to claim duty exemption for hospital equipment imported in 1991. The notification required submission of an installation certificate within two years of import. The respondent received a show cause notice alleging non-compliance with notification conditions.

Compliance with Notification Conditions:
The respondent contended it had met all notification requirements, leading to the initiation of proceedings. The original authority upheld the duty demand and imposed penalties. The respondent appealed to the Tribunal, which accepted the appeal based on the submission of the installation certificate to the Director General Health Services and State Health Department within the stipulated time frame.

Confiscation and Penalty Imposition:
The Tribunal found in favor of the respondent, noting the submission of the installation report within the required period. The revenue's counsel failed to counter the respondent's claim of timely submission. The Tribunal's factual finding remained unchallenged, resulting in the dismissal of the Civil Appeal without costs due to no infirmity in the Tribunal's order.

In conclusion, the Supreme Court upheld the Tribunal's decision, emphasizing the importance of timely submission of installation certificates as per the notification requirements. The case highlights the significance of complying with statutory conditions to avail duty exemptions and the need for thorough documentation to support claims, ultimately leading to the dismissal of the appeal.