1997 (4) TMI 155 - AT - Customs

Summary

Issues:
Whether the benefit of exemption under Notification No. 13/81-Cus. can be extended to spares for production trucks and drills.

Detailed Analysis:

Issue 1: Benefit of Exemption for Spares of Production Trucks
The appellants, a Government of India Enterprise, imported goods for export purposes and claimed exemption for spares of trucks under Notification No. 13/81. The authorities denied the exemption, stating that trucks were not production machinery. The appellant argued that trucks were integral to the production process, citing relevant case law. The Revenue contended that trucks were not material handling equipment. The Tribunal analyzed the role of trucks in handling ore and their connection to the production process. Referring to Supreme Court decisions, the Tribunal held that trucks were indeed production machinery, and their spares were eligible for exemption under the notification.

Issue 2: Benefit of Exemption for Spares of Drills
Similarly, the benefit of exemption for spares of drills was in question. The authorities denied the exemption, stating that drills were not part of the production process. The appellant argued that drills were essential for the production process. The Tribunal examined the functionality of drills and their role in the production process. Citing relevant case law and Supreme Court decisions, the Tribunal concluded that drills were integral to the production machinery and their spares were eligible for exemption under Notification No. 13/81.

Conclusion:
After considering submissions from both sides and examining the records, the Tribunal found in favor of the appellants. It held that trucks and drills were indeed production machinery, essential for the production process. Therefore, the spares for trucks and drills were eligible for exemption under Notification No. 13/81. All six appeals filed by the appellants were allowed accordingly.