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Claim for import duty on 'Dival Multi-layer Coater machine' without exemption benefit under Notification No. 125/86. Analysis: The petition challenged the Respondents' action of claiming import duty on the 'Dival Multi-layer Coater machine' imported by the Petitioners without affording the benefit of exemption under Notification No. 125/86. The Petitioners imported the machine covered by Entry No. 32 of the said Exemption Notification. Initially, the Respondents did not assess the Bill of Entry due to doubts about the machine. The Petitioners provided a supplier's letter confirming the machine's identity, leading to its clearance on 29-2-1988. However, a subsequent amendment to Notification No. 125/86 withdrew the exemption, and the Petitioners were asked to pay duty since they had not taken delivery by 1-3-1988 while the machine was warehoused. The Petitioners contended that they fulfilled the requirements under Section 68 of the Customs Act by presenting the Bill of Entry and offering duty payment, which the Assessing Officer did not accept initially. They argued that the rate of duty applicable should be as per the date of actual removal from the warehouse, which was on 29-2-1988. The Petitioners emphasized that they should not be denied the exemption benefit due to the Customs Officer's erroneous assumption about the machine's identity. The Revenue acknowledged that duty payment was offered before 29-2-1988 but was not accepted. The Court found that the Petitioners met the conditions under Section 68, and the order for clearance was passed on 29-2-1988. Citing the decision in Priyanka Overseas Pvt. Ltd. case, the Court held that the duty rate applicable should be as of the clearance date. Therefore, the Petitioners were entitled to the benefit of Exemption Notification No. 125/86, and the Revenue's delay in passing the clearance order could not be used against the Petitioners. The demand for duty was deemed null and void, and the Petitioners were allowed to clear the goods under an interim order, with entitlement to receive the bank guarantee upon duty payment. In conclusion, the petition was allowed, and the rule was made absolute with no order as to costs.
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