Imports by Hospitals - Eligibility for the benefits of exemption under Notfn. No.l52/94-Cus. (Previously 70/81) - Clarification - Customs - F. No. 528/76/93-Cus.(TU)

Imports by Hospitals - Eligibility for the benefits of exemption under Notfn. No.l52/94-Cus. (Previously 70/81) - Clarification F. No. 528/76/93-Cus.(TU) Dated 19-9-1994 Government of India Ministry of Finance (Department of Revenue) New Delhi Subject : Imports by Hospitals - Eligibility for the benefits of exemption under Notfn. No.l52/94-Cus. (Previously 70/81) - Clarification - Reg. Kind reference is invited to the provisions of Notfn. No. 152/94 or 70/81-Cus., whereby scientific and technical instruments imported by Research Institutions, not engaged in commercial activities are exempted from all duties. Recently it was brought to the notice of the Board that a premier hospital rendering medical services to patients on charge basis was claiming the benefit of the above said exemption, for their imports of medical equipments used in diagnosis and/or treatment. They had also submitted MMI Certificate and DEC issued by the Ministry of Science and Technology, certifying that the imports are meant for research and that the institute was not engaged in any commercial activity. The Board had examined the matter and taking into account all the facts and keeping in mind the various decisions of Tariff Conferences on the scope of the term "Research Institution", it has been decided that the benefit of the said exemption cannot be extended to such institutions. The Board is also not convinced that the activities of such hospitals are of non-commercial nature, though it has been pleaded that the hospital runs on charities, without any concept of profits and that the charges collected are ploughed back into running the hospital. Accordingly, to make it sure and obvious, an exclusion has also been built into the said notification w.e.f. 1-3-1994, vide amending Notfn. No-93/94-Cus., dated 1-3-1994 whereby it has been expressly provided that the exemption will not be available to hospitals and an inclusive definition for hospitals has also been provided. Even after the abovesaid amendment, there has been a feeling in some quarters that the new exlusion applies to only such hospitals which render treatment without any research. This is not correct, and for the removal of doubts it is hereby clarified that any organisation which is a hospital or which can be called a hospital under the inclusive definition in the notification, will not be eligible for the benefit of the said exemption, whether or not it is engaged in any research. The above may kindly be taken note of for information and guidance in respect of all past and future clearances of such imports. Action may be taken for recovery of duty in such cases where the abovesaid principles have not been followed.