1996 (3) TMI 216 - AT - Customs

Summary

Issues:
Eligibility of goods for Captive Power Plant under exemption Notification No. 71/85-Cus.
Classification of Captive Power Plant as a Power Project for customs duty exemption.

Analysis:
The appeal was filed by the Revenue against the Order-in-Appeal dated 17-7-1985 by the Collector of Customs (Appeals), Bombay, regarding the eligibility of goods for a Captive Power Plant under exemption Notification No. 71/85-Cus. The matter involved M/s. Thermax Pvt. Ltd. importing boilers and accessories for use in the Captive Power Plant of M/s. Gujarat Heavy Chemicals Ltd. (GHC) engaged in soda ash manufacturing. The dispute centered around whether the imported goods qualified for assessment under Heading No. 84.66 of the Tariff for Power Projects under the said exemption.

During the hearing, the Revenue contended that the Captive Power Plant of GHC did not qualify as a Power Project for the purposes of the exemption Notification. They referenced a Public Notice from the Customs House, Bombay, stating that Captive Power Plants in industrial plants were not classified as Power Projects. The Revenue relied on a previous Tribunal decision emphasizing the importance of a Contract for import classification as Power Projects.

The Tribunal analyzed the exemption Notification No. 71/85-Cus., which exempted goods falling under Heading No. 84.66 for Power Projects from customs duty, subject to specific conditions. The respondents had applied for registration under this heading, but the Asstt. Collector of Customs initially rejected it, arguing that the Captive Power Plant did not qualify as a Power Project under the exemption. The Tribunal noted that there was no clear explanation of 'Power Projects' in the exemption Notification during the relevant period.

Further, the Tribunal discussed subsequent Public Notices and High Court judgments regarding the interpretation of 'Power Projects' under similar exemption Notifications. They highlighted that prior to a specific amendment on 1-5-1986 excluding Captive Power Plants from the definition of 'Power Projects,' there was no such restriction. The Tribunal also noted that previous amendments to the exemption were challenged and struck down by High Courts.

In conclusion, the Tribunal found no fault in the Order-in-Appeal and rejected the Revenue's appeal, emphasizing that the Tribunal's previous decision cited by the Revenue was not relevant to the current case.

Therefore, the Tribunal upheld the assessment of the imported goods for the Captive Power Plant under Heading No. 84.66 of the Tariff in accordance with Notification No. 71/85-Cus.