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TMI Blog2000 (9) TMI 659X X X X Extracts X X X X X X X X Extracts X X X X ..... on the basis of importer s declaration that the Plant and Machinery was for the manufacture of electronic components and equipments. Subsequently, a show cause notice dated 5-5-1986 was issued for demanding duty and for imposing penalty on Importer Company and its official mainly on the grounds that (a) the polypropylene capacitors to be manufactured by the imported plant and machinery were exclusively used in electrical gadgets and not in any electronic items and as such the benefit of Notification No. 118/80-Cus. was not available to the imported goods and same could not be imported under OGL vide S. No. 11 of APP 2 of Import Policy 1983-84; (b) the spare parts and size parts had not been indicated in the invoice and the purchase Order and these were imported as machineries with standard accessories , and (c) the existence of contract dated 20-3-1981 which listed 22 items was suppressed; this list was replaced by another schedule containing 9 items only though the total price remained unchanged and all the goods, except 3 items, were received and that this regrouping was done with a view to get the benefit of Notification No. 118/80-Cus. and for importing the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ugned Order has clearly given his findings that the Department of Electronics had categorically held that the firm held an Industrial Licence for manufacture of plastic film capacitors and they have stated that all plastic film capacitors are electronic capacitors but many of these capacitors find application in electrical industries as well. The ld. Advocate also referred to journal, namely Electronics Informations and Planning , November, 1985, which also refers to plastic film capacitors in the list of Licences and Letters of Intent issued; that once the Department had accepted the clarification given by the Department of Electronics, it would not only apply to the applicability of concessional rate of duty under Notification No. 118/80 but also to Sl. No. 11 of Appendix 2 of Import Policy for 1983-84. The ld. Advocate submitted that the 7 items of machinery have not been considered as accessories by the Collector as these were not integrated or adopted to the main machines and their value were indicated separately in the original contract; that it is not necessary that an accessory of a machinery should be integrally connected with the main machine while the same is functionin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the ld. DR, Shri Ashok Kumar submitted that capacitors meant for Electrical Industries cannot be considered as electronic components or equipments in view of ISI specifications namely ISS-1709-1960, IS 2993-1963, IS 1569-1976 for fans, luminaries and motor vehicles respectively; that since the capacitors found exclusive use in electrical gadgets and not in any electronic gadgets, the same cannot be called electronic components, and therefore imported plant and machinery is not covered by the entry machinery for manufacture of electronics components and equipments mentioned at Sl. No. 11 of Appendix 2 of Import and Export Policy 1983-84; that since Notification 118/80-Cus. and Import-Export Policy are different, certificate from the Department of Electronics is not relevant for the purpose of Import Export Policy. He, further, submitted that concessional rate of duty under Notification No. 118/80 was not applicable to the parts, accessories as most of them are classifiable under different headings of Chapters 84 and 85 of the Customs Tariff; that the provisions of Accessories (Conditions) Rules, 1963 had not been satisfied as there is sufficient evidence to show that these were not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er, that the project for which machines were imported was an Electronic Industry and they were importable under OGL. We also do not find any reason to disagree with the findings of the Collector, that the 7 items of machinery were not accessories in view of his detailed findings given in the impugned Order. The Collector, besides holding that the machines were not integrated and were functioning separately has also observed that even going by the Accessories Conditions Rules, it is not as though every item which is imported alongwith the machinery or can be integrated with the main machinery can be considered as an accessory; the condition is that such accessories are compulsorily supplied along with the article in the ordinary course of trade and no separate charge is made for supply. According to the findings of the Collector in the instant case, 4 items were individually listed in the list attached to the original contract and separate price had been given indicating that they were charged seperately. The Collector has also considered the functioning performed by these machines and came to the conclusion that they were independent machines or equipments which findings of the Col ..... X X X X Extracts X X X X X X X X Extracts X X X X
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