1985 (3) TMI 171 - AT - Customs

Summary

Issues Involved:
1. Eligibility for concessional rate of customs duty under Notification No. 40/78-Cus.
2. Eligibility for clearance under Open General Licence (OGL) as per AM Policy for 1984-85.
3. Classification of the imported machine as a versatile tool or a specific hob-grinder.

Issue-wise Detailed Analysis:

1. Eligibility for Concessional Rate of Customs Duty:
The appellants, M/s Chowgule Matrix Hobs Ltd., imported a KOEPFER RELIEF GRINDING MACHINE and claimed a concessional rate of duty under Notification No. 40/78-Cus., dated 1-3-1978. The Customs authorities declined this claim, arguing that the machine was a versatile tool capable of multiple functions and not exclusively a hob-grinder. The appellants contended that the machine's primary function was hob-grinding, and its additional capabilities should not disqualify it from the concessional rate. The Additional Collector of Customs rejected this argument, noting that the machine was versatile and did not fit the specific description required for the concessional rate. The Tribunal upheld this view, stating that the appellants failed to prove the machine met the specific criteria under the notification. The Tribunal emphasized that the onus was on the appellants to establish that the machine entirely fit the description as contemplated by the notification, which they failed to do.

2. Eligibility for Clearance under Open General Licence (OGL):
The appellants also sought clearance under OGL by virtue of Entry Serial No. 24, Appendix I, Part B, in Vol. 1 of the Import Policy for AM 1984-85. The Customs authorities required a specific licence, arguing that the machine was not a simple hob-grinder but a versatile tool. The appellants relied on a certificate from the Director General of Technical Development (DGTD), which stated that the machine fell under the specified entry in the Import Policy. The Tribunal found the DGTD certificate conclusive regarding the import policy, noting that the policy was framed in consultation with the DGTD. The Tribunal concluded that the importation under OGL was permissible based on the DGTD certificate, thus setting aside the order of confiscation and the consequential imposition of a redemption fine.

3. Classification of the Imported Machine:
The core issue was whether the imported machine was a versatile tool or a specific hob-grinder. The Customs authorities classified it as a versatile machine based on the manufacturer's catalogue, which described its multiple functions. The appellants argued that its predominant use was hob-grinding, supported by their industrial licence for manufacturing hobs and the DGTD certificate. The Tribunal agreed with the Customs authorities' classification for duty purposes, noting that the machine's description in the catalogue justified its classification as a versatile tool. However, for licensing purposes, the Tribunal accepted the DGTD certificate as conclusive, allowing the importation under OGL.

Conclusion:
The Tribunal partially allowed the appeal, rejecting the claim for a concessional rate of customs duty under Notification No. 40/78-Cus. but setting aside the order of confiscation and the imposition of a redemption fine. The machine was classified as a versatile tool for duty purposes but allowed clearance under OGL based on the DGTD certificate.