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Issues:
Import duty on high power valves used in the manufacture of amplifiers; Interpretation of import licence conditions; Exemption from customs duty under Notification No. 3/69; Application of duty on parts used for different products. Analysis: The petitioners imported high power valves for manufacturing amplifiers under an actual users' license. The import license specified that the imported material should be used only for the products for which it was allowed to be imported. The Customs authorities levied duty on the imported valves under Item 73(10) of the I.C.T., considering them suitable for wireless receiving sets. The petitioners contended that no duty should be charged as the valves were meant for amplifiers, not wireless sets. They cited Notification No. 3/69, which exempts parts if used in electronic equipment other than wireless sets under Item No. 33A of the First Schedule. The learned Counsel argued that there was no evidence of the valves being used in radio receivers and that the petitioners had an actual users' license for manufacturing amplifiers, not wireless sets. The court found merit in the argument, stating that duty exemption applied if the parts were used for electronic equipment other than wireless sets. Since the petitioners only manufactured amplifiers and were restricted by the import license to use the parts for that purpose, duty exemption was justified. The court held that the Customs authorities erred in not granting duty exemption based on the specific conditions of the import license and the nature of the petitioners' business. The petitioners were entitled to the exemption under the notification dated 11th January, 1969. Consequently, the court allowed the petition, setting aside the orders of the Assistant Collector of Customs, Appellate Collector of Customs, and the Central Government. The petitioners were granted a refund of the excise duty amounting to Rs. 9000, to be paid within three months from the date of the judgment. No costs were awarded in the matter.
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