2009 (12) TMI 259 - HC - Central Excise

Ultrasound scanner- The petitioner is an exporter of Portable Linear Scanner. The first respondent has introduced a scheme of export incentives by name Cash Compensatory Support Scheme. Under the said scheme, cash assistance has been made available against the eligible export items. Held that- Impugned item classifiable under SI. No. 49(b0 as specifically included under it and not under SI. No. 25(i) of Circular No. 12/49/86-EAC, dated 30.06.1986. Classification of goods- When decision is made by a committee which is competent to go into the same. Classification of goods- Interpretation regarding classification of goods to be construed in the sense in which person who deal in such goods understand it normally. Goods must also be classified according to their popular meaning and commercial sense as well. Court to select meaning relevant to context in which it has to interpret the word. Functional test also a relevant factor.

Issues Involved:
1. Classification of exported goods under the Cash Compensatory Support (CCS) Scheme.
2. Entitlement to CCS percentage for exported items.
3. Interpretation of policy and circulars regarding export incentives.
4. Jurisdiction and authority of the court in reviewing administrative decisions.

Detailed Analysis:

1. Classification of Exported Goods under the CCS Scheme:
The primary issue revolves around the classification of the petitioner's exported goods, specifically the ultrasound scanner with Doppler/Portable Linear Ultrasound scanner, under the CCS Scheme. The petitioner argued that their goods should fall under Serial No. 25(i) of the Circular, which provides a 15% CCS for electronic instruments and appliances. Conversely, the respondents classified the goods under Serial No. 49(b), which pertains to surgical/medical instruments and offers a 10% CCS. The court noted that the goods in question contain electronic components but are primarily used as medical instruments, thus falling under the more specific category of Serial No. 49(b).

2. Entitlement to CCS Percentage for Exported Items:
The petitioner claimed entitlement to a 15% CCS based on the classification under Serial No. 25(i). However, the Headquarters Classification Committee reclassified the goods under Serial No. 49(b) with a 10% CCS. The court supported the Committee's decision, emphasizing that specific descriptions in classification take precedence over broader ones. The court also dismissed the petitioner's reliance on a certification from the Department of Electronic Goods, stating it was not binding on the respondents and did not clarify the classification under the relevant serial numbers.

3. Interpretation of Policy and Circulars Regarding Export Incentives:
The court addressed the interpretation of the CCS Scheme and the relevant circulars, emphasizing that classification should be based on the specific descriptions provided in the circular. The court referred to legal precedents, indicating that goods must be classified according to their popular and commercial meaning, as understood by those dealing with them. The court cited several judgments, including those from the Supreme Court, to reinforce that specific entries in a classification list should be given precedence and that the government's interpretation of its own schemes should be respected unless there is ambiguity.

4. Jurisdiction and Authority of the Court in Reviewing Administrative Decisions:
The court underscored its limited role in reviewing administrative decisions, especially those made by competent authorities like the Headquarters Classification Committee. It reiterated that the High Court cannot act as an appellate authority in the absence of any apparent mistake on the face of the record. The court referenced previous judgments to support this stance, asserting that it should not interfere with administrative decisions unless they are perverse or unreasonable.

Conclusion:
The court concluded that the petitioner's goods were correctly classified under Serial No. 49(b) of the circular, carrying a 10% CCS. It dismissed the writ petition, affirming that the administrative decision was based on relevant materials and competent authority deliberations. The judgment emphasized the importance of specific classification entries and the limited scope of judicial review in such administrative matters.

← Previous Next →