2024 (10) TMI 1357 - AT - Customs

Import of goods at concessional rate of duty - Process amounting to manufacture - assembly from the semi -knockdown condition to full TV - argument of the revenue is that the goods imported by the appellants are in semiknockdown condition - HELD THAT - It is seen that what is being imported are not goods in semi -knockdown condition. All the goods imported are individual items separately classifiable under different headings. Learned counsel pointed out that they are buying many products from local market. However, even if that is not the case, assembly of Television from individual components to a full T.V is a process of manufacture. In fact, there are no evidence whatsoever of any imports under semi-knockdown condition as can be seen from the list declared by the respondents in their applicable. There are no merit in the appeal filed by the revenue, and the same is dismissed.

Issues:
1. Interpretation of the term "manufacture" under Customs rules for duty benefit eligibility.
2. Determination of whether the imported goods were in semi-knockdown condition.
3. Assessment of whether the assembly of individual components into a full TV constitutes manufacturing for duty benefit purposes.

Analysis:

Issue 1: Interpretation of the term "manufacture"
The case involved an appeal by Bossh Technology India Limited against the rejection of their application for import duty benefits under Customs rules. The Assistant Commissioner rejected the application, stating that the process undertaken by the appellant did not qualify as "manufacture" as defined in the relevant Customs rules. The Commissioner (Appeals) disagreed, highlighting that the appellant was registered as a manufacturer and had previously availed of duty benefits without issue. The Commissioner held that the rejection was based on incorrect assumptions and without proper verification. The review order by the revenue reiterated the Assistant Commissioner's findings, arguing that no new product emerged from the assembly process, thus not constituting manufacture.

Issue 2: Goods in semi-knockdown condition
The revenue contended that the imported goods were in semi-knockdown condition, leading to the conclusion that no new product emerged from the assembly process. However, the respondent's counsel argued that the goods were individual components, not in semi-knockdown condition. They pointed out that many components were procured domestically, and the assembly process was akin to manufacturing, even if the goods were imported in semi-knockdown condition.

Issue 3: Assembly of individual components
Upon reviewing the submissions, the Tribunal found that the goods imported were individual items, not in semi-knockdown condition. The assembly of these components into a full TV was considered a manufacturing process. The Tribunal noted that there was no evidence of imports in semi-knockdown condition. Consequently, the appeal by the revenue was dismissed, affirming that the assembly of individual components into a full TV constituted manufacturing for duty benefit purposes.

The Tribunal's decision, pronounced on 23.10.2024, upheld the Commissioner (Appeals) ruling and rejected the revenue's appeal, emphasizing that the assembly process of individual components into a complete TV qualified as manufacturing for the purpose of availing duty benefits under the Customs rules.

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