2018 (6) TMI 18 - AT - Customs

Eligibility for exemption - Import of Asphalt Hot Mixing Plant - electronically controlled plant or electrically controlled plant - Benefit of N/N. 21/2002-Cus. - Case of Revenue is that the plant imported by the appellant is electrically controlled, and not eligible for benefit under exemption entry no. 230 of N/N. 21/2002-Cus. - Conclusion of the revenue is based on the report of the departmental panel - whether the appellant being importer of Asphalt Hot Mixing Plant with electronic controls and Bag type filter arrangement is eligible for N/N. 21/2002-Cus. (S.No. 230)? Held that - The appellant admittedly imported Hot Mixing Plant which was declared as Asphalt Hot Mixing Plant with electronic controls and Bag type filter 125TPH in the bill of entry. On perusal of invoice the description is also same as declared in the invoice. Therefore it is clear that the supplier also declared the plant having electronic control system. From the report of SGS it is clear that the plant imported is electronically controlled. In the report, the basis for conclusion being electronically controlled is also given i.e. the operation of the plant is controlled by PLC. In view of the report even if it is accepted that some part of the plant is operated electrically it cannot take away the characteristic of the plant being controlled electronically. Correctness of reliance placed by the revenue on the departmental panel - Held that - Firstly the departmental panel is not the authorised technical expert to conduct the test of the plant. Instead of this the revenue should have taken a report/opinion from independent technical expert. Secondly, even if the department's opinion is accepted that PLC installed it controls the operation of the plant electronically. Therefore, the report given by the departmental panel cannot be accepted. Since we made an opinion that the plant imported by the appellant is electronically controlled, therefore we do not see any violation of the condition of the notification - appeal allowed - decided in favor of appellant.

Summary

Issues Involved:
Whether the appellant, as an importer of Asphalt Hot Mixing Plant with electronic controls and Bag type filter arrangement, is eligible for exemption under notification no. 21/2002-Cus. (S.No. 230).

Analysis:

Issue 1: Eligibility for Exemption
The revenue contended that the plant imported by the appellant was electrically controlled, not electronically controlled, and therefore not eligible for exemption under notification 21/2002-Cus. The revenue relied on the departmental panel's report to support this contention.

The appellant's counsel argued that the plant was both electronically and electrically operated, highlighting the presence of a PLC controller. An independent inspection agency, SGS, certified that the plant was electrically operated and electronically controlled. The counsel criticized the revenue for not seeking an opinion from an independent technical expert and relying solely on the departmental panel's report.

The revenue reiterated its stance that only plants electronically controlled were eligible for exemption under the notification. They cited a Supreme Court judgment to support their argument.

Issue 2: Evaluation of Technical Reports
Upon review of the technical reports, it was found that the imported Hot Mixing Plant was declared as having electronic controls in the bill of entry and the supplier's invoice. The report from SGS detailed the various control mechanisms, concluding that the plant was both electrically operated and electronically controlled.

The tribunal agreed with SGS's assessment, emphasizing that the operation of the plant was controlled by a PLC, meeting the criteria for electronic control. They criticized the revenue for relying on the departmental panel, stating that it was not an authorized technical expert. The tribunal concluded that the plant imported by the appellant was indeed electronically controlled, thereby eligible for exemption.

Conclusion
The tribunal set aside the impugned order and allowed the appeal, determining that the appellant's imported plant met the requirements for exemption under the notification. The judgment was pronounced on 11/05/2018.