1990 (7) TMI 243 - AT - Customs

Summary

Issues:
1. Whether the item imported is a computer system?
2. Whether the import thereof is permissible under OGL, without complying with the requirements of Chapter 5 of the Policy AM 1983-84?

Analysis:

The appeal before the Appellate Tribunal CEGAT, Bombay concerned the import of a UV-Visible Spectrophotometer (Double Beam) by the appellants, which was objected to by the customs department on the grounds that it was considered a computer system and required prior permission from the Department of Electronics for import under OGL. The authorities below held the import unauthorized but allowed it on payment of a redemption fine. The appellants contended that the item was permissible under OGL as it was not a computer system. The issue revolved around whether the imported item was a computer system and if its import was permissible under OGL without complying with Chapter 5 of the Policy AM 1983-84.

Regarding the first issue of whether the imported item was a computer system, the literature produced by the appellants described it as a "completely micro computer controller system" and "A UV/Visible computer system." The authorities below extensively examined the catalog and concluded that the item was computer-based. Despite the argument that being computer-based was different from being a computer system, the definition in the Policy Book AM 1983-84 left little room to consider the item as anything other than a computer system.

On the second issue of whether the import was permissible under OGL, the specific item, VV Spectrophotometer (double beam), was listed in Appendix 2 of the Policy Book without any restrictions. The Policy indicated that imports were subject to applicable conditions. While Chapter 5 of the Policy applied to computer systems, there was no such reservation for items listed in Appendix 2. The conditions in Appendix 10 did not mandate approaching the Department of Electronics for computer-based items. The absence of a specific mention in Appendix 10 reinforced the conclusion that the provisions of Chapter 5 did not apply to items listed in Appendix 2.

Ultimately, the Tribunal found that since the imported item was specifically listed in Appendix 2 without any qualifying clause, and the conditions of Chapter 5 did not apply, there was no valid ground to object to its import under OGL. Therefore, the objection raised and the order of confiscation were set aside, and the appeal was allowed with consequential relief to follow.