1995 (5) TMI 116 - AT - Customs

Summary

Issues:
1. Eligibility of the imported machine for clearance under OGL and benefit under Notification No. 118/80-Cus.

Analysis:

The appeal was filed against an order passed by the Additional Collector of Customs, Bombay, concerning the importation of an Automatic Wire Cutting and Stripping machine from Japan by the appellants, who are manufacturers of T.V. sets. The machine was declared as such in the Bill of Entry and was claimed for clearance under OGL and benefit under Notification No. 118/80-Cus. However, a show cause notice was issued due to the machine being described as an Auto Wire Twisting machine in the handling manual. The Additional Collector rejected the appellants' contention that the machine was primarily for cutting and stripping wires, stating it was not exclusively meant for that purpose and was not eligible for the claimed benefits. Still, he allowed clearance under OGL with a caution for future cases.

Upon examination, the Appellate Tribunal considered whether the machine was eligible for clearance under OGL and the benefit under Notification No. 118/80-Cus. The relevant OGL entry covered "automatic wire cutting and stripping machine," and the notification included machines with or without certain attachments used in the electronic industry. The manufacturer's catalogue described the machine as performing cutting, stripping, and twisting operations, with the twisting mechanism being an additional capability that could be set aside when not needed. The Tribunal referred to past judgments where machines capable of additional functions were still eligible for exemptions.

Based on the manufacturer's description, past judgments, and a clarification from the Department of Electronics confirming the machine's primary function as wire cutting and stripping with an additional twisting capability, the Tribunal held that the machine was indeed eligible for clearance under OGL and the benefit under Notification No. 118/80-Cus. Therefore, the impugned order was set aside, and the appeal was allowed with consequential relief.