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Issues:
1. Eligibility for duty-free import under Notification 70/81 for scientific equipment. 2. Interpretation of the term "imported by a research institution" under the notification. Analysis: 1. The case involved a dispute regarding the eligibility of M/s. Karnataka Dairy Dev. Corpn. Ltd. for duty-free import under Notification 70/81 for "Freeze and Accessories (Industrial Refrigerator)" imported by them. The Collector (Appeals) initially ruled in favor of the appellant, stating that the goods were procured for the Institute of Animal Health and Veterinary Biologicals for the production of vaccines, making them eligible for total exemption from duty under the said notification. 2. The main contention raised by the Revenue in their appeal was that the import should have been made by a research institution as per the conditions of Notification 70/81. The Revenue argued that since Karnataka Dairy Dev. Corpn. is a commercial organization, the goods imported by them were not eligible for exemption under the notification. The Revenue emphasized that the goods must be essential for research purposes and used only for such purposes to qualify for the duty exemption. 3. On the other hand, the respondent argued that the goods were imported on behalf of the research institute and were used for research purposes, making them eligible for the exemption. The respondent contended that the research institute was the actual importer as they had obtained the necessary certificate for the duty-free import of the goods. It was highlighted that the goods were imported for the institute's use, aligning with the conditions of the notification. 4. The Tribunal analyzed Notification 70/81, which exempts scientific instruments imported by a research institution from customs duty, subject to specific conditions. The Tribunal noted that the notification explicitly mentions "imported by a research institution," emphasizing the requirement for direct import by the research institution itself. Referring to precedents, the Tribunal clarified that the import must be by the institution and not merely on behalf of the institution to qualify for the exemption. The Tribunal distinguished previous cases and held that the goods must be directly imported by the research institution to avail the benefits of the notification. 5. Ultimately, the Tribunal found merit in the Revenue's appeal, concluding that the import by Karnataka Dairy Dev. Corpn. Ltd. did not meet the criteria specified in Notification 70/81. As a result, the Tribunal allowed the Revenue's appeal and overturned the Collector (Appeals) order, indicating that the duty-free exemption under the notification was not applicable in this case.
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