1986 (7) TMI 107 - HC - Customs

Summary

Issues: Interpretation of exemption notification under Customs Tariff Act for import of hot rolled stainless steel strips exceeding 500 mm width for cold rolling.

Analysis:
The judgment delivered by Pendse, J. of the High Court of Judicature at Bombay pertains to a case involving the interpretation of an exemption notification under the Customs Tariff Act, 1975. The petitioners, a company engaged in the manufacture of steel strips, imported hot rolled stainless steel strips exceeding 500 mm width for cold rolling. The Customs Authorities required proof of width and end-use proof, leading to a petition challenging an adjudication order denying the exemption provided in the notification. The Deputy Collector of Customs contended that the imported coils were slitted into smaller width before cold rolling, thus disqualifying the petitioners from the notification's benefit.

The key contention raised by the petitioners, represented by Shri Joshi, was that the conditions for benefit under the exemption notification were met: the imported coils exceeded 500 mm width and were imported for cold rolling. The court agreed with this argument, emphasizing that the width of 920 mm and the purpose of cold rolling were undisputed. The court rejected the Department's argument that slitting the coils invalidated the notification's advantage, illustrating with an example where slitting for cold rolling did not disqualify the importer from claiming the benefit. The judgment emphasized that once the coils were imported over 500 mm width and used for cold rolling, the importer was entitled to the notification's benefit.

Consequently, the court held the Deputy Collector's order as unsustainable and quashed it. The petition was successful, and the order dated September 2, 1982, by the Deputy Collector of Customs was annulled. As the goods were already cleared by an interim order, other reliefs sought by the petitioners were deemed unnecessary. No costs were awarded in this case.

In conclusion, the judgment clarified the conditions for availing exemption under the Customs Tariff Act for importing stainless steel strips exceeding 500 mm width for cold rolling. It emphasized that once the conditions of width and purpose were met, any subsequent processing, like slitting, did not disqualify the importer from claiming the benefit. The decision provided clarity on the interpretation of exemption notifications in similar cases, ensuring fair treatment for importers meeting the specified criteria.