1997 (4) TMI 228 - AT - Customs

Super Vacuum Packing Machine imported by a Research Institution exempted under Notification No. 70/81-Cus.

Summary

Issues:
1. Denial of exemption under Notification No. 70/81 for the imported Super Vacuum Packing machine.
2. Interpretation of the conditions for exemption under Notification No. 70/81 for scientific and technical instruments imported by Research Institutions.
3. Determination of commercial activity by Research Institutions.
4. Validity of certificates required for claiming exemption under Notification No. 70/81.
5. Distinction between Public Funded Research Institutions and Private Research Institutions in claiming exemption.

Analysis:
The case involved an appeal against the denial of exemption under Notification No. 70/81 for the import of a Super Vacuum Packing machine by the Respondents. The Assistant Collector had refused the exemption, stating that the Respondents did not clearly indicate they were not engaged in commercial activities, as they were receiving fees for services rendered. However, the Collector (Appeals) overturned this decision, noting that the fees were merely reimbursement for expenses and that the Assistant Collector provided no valid reasons for his stance. The Collector (Appeals) also highlighted the lack of distinction between public and private Research Institutions in the relevant regulations.

The Tribunal examined the conditions for exemption under Notification No. 70/81, which required certification that the imported goods were essential for research and not manufactured in India. The Tribunal emphasized that once a duly authorized officer certifies that an institution is a research institution not engaged in commercial activities, the claim for exemption should be accepted. The Tribunal clarified that charging fees for services does not necessarily constitute commercial activity, especially without evidence from the Revenue. The Tribunal criticized the Assistant Collector for lacking reasons to support his claim that the imported goods were not scientific and technical instruments, as required by the notification.

Moreover, the Tribunal highlighted the importance of the certificates required under Notification No. 70/81, emphasizing that the statements made by the Assistant Collector without proper justification were not sustainable. The Tribunal rejected the distinction made by the Assistant Collector between Public Funded Research Institutions and Private Research Institutions, as the notification did not establish such a difference. Ultimately, the Tribunal found no merit in the Revenue Appeal, upholding the Collector (Appeals) decision and rejecting the appeal.

In conclusion, the judgment clarified the criteria for claiming exemption under Notification No. 70/81 for scientific and technical instruments imported by Research Institutions, emphasizing the importance of valid certifications and the lack of justification for denying exemptions based on unsubstantiated claims of commercial activity.