2005 (2) TMI 302 - AT - Customs

Summary

Issues:
1. Applicability of Notification No. 70/81-Cus., dated 26-3-81 for exemption from Customs duty.
2. Failure to satisfy the conditions prescribed under the Notification.
3. Requirement of specific certificates for exemption eligibility.

Analysis:

1. The case involved a Public Sector Undertaking integrated steel plant that imported a "XMET 840 Portable X-Ray Analyser" for its Research and Development Centre. The appellant claimed exemption benefit under Notification No. 70/81-Cus., dated 26-3-81, which exempted non-commercial research institutions from Customs duty. The appellant's appeal for exemption was denied during the assessment, leading to the deposit of Customs duty amounting to Rs. 33,29,964.80. Subsequently, a refund application was filed, which was rejected by the Commissioner (Appeals) on the ground that the R & D unit of commercial concerns was not entitled to the exemption. The appellant argued that their case fell under the precedent set in a similar case, emphasizing that the R & D unit was engaged in research, not commercial activities.

2. The appellant failed to satisfy the conditions laid down in Notification No. 70/81-Cus., dated 26-3-81, which required specific certificates to be furnished. The Assistant Collector's order highlighted the lack of documentary evidence justifying full exemption from Customs duty. The conditions for exemption included certification by the Directorate General of Technical Development that the imported goods were not manufactured in India and a certificate from an officer confirming the essential nature of the import for research purposes. The appellant only provided a certificate stating the non-commercial nature of the R & D Centre but failed to prove the essentiality of the imported goods for research or that they were not manufactured in India.

3. The Notification mandated the submission of specific certificates to qualify for exemption, which the appellant failed to produce. Despite being directed to provide the necessary documents, the appellant could not furnish the required certificates from the Directorate General of Technical Development and the Ministry administratively concerned with the institution. The absence of these crucial certificates led to the dismissal of the appeal by the Appellate Tribunal CESTAT, Kolkata, as the appellant did not meet the conditions stipulated for exemption eligibility.

This detailed analysis of the judgment showcases the significance of fulfilling specific conditions and providing essential certificates to claim exemption benefits under relevant Notifications, emphasizing the importance of compliance with legal provisions in customs matters.