9911796707
TMI Blog2008 (5) TMI 13X X X X Extracts X X X X X X X X Extracts X X X X ..... e imported by the respondent herein as second hand equipment is also not in dispute. It is, however, accepted that the original manufacturers of the two part of the said equipment were different. We may, at the outset, notice that the Notification dated 11.4.1997 was issued by the Central Government, in exercise of its power conferred upon it under Section (1) of Section 25 of the Customs Act, 1962, being satisfied that it was necessary in the public interest so to do, made further amendment in notification No.11/97, CUS. dated 1.3.1997, the relevant entry whereof is as under : "(1) (2) (3) (4) (5) (6) 144A 84 or any other Chapter Goods specified in List 8A required for setting up crude petroleum refinery Nil Nil -" 3. By reason of the amendment, it was, inter alia, provided that in the annexure, for List 8A the goods specified therein shall be substituted, relevant portion of which reads as under : "16. All types of Materials Transporting Equipments, including loading and unloading arms and racks; gantries, dispatch tanks, loading/ transfer pumps, hydraulic systems, weighbridges, Diesel shunters, feed or injenction or spray nozzles, skimmers, soot blowers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p; XXX 44. Special Maintenance Systems, including hydrojetting tools, pneumatic torque wrenches; EOT/mobile cranes; hoists, grinders, high pressure cleaning systems, induction bending machines; auto welding machines, various welding equipments like girth-welding, vertical flux cord, bottom saw, four side edge preparation, angle rolls; rolling and leveling machines, sky climbers, hot tapping machines, bolt tensioners, high pressure test pumps, tube bundle pullers, tube nippers, ultrasonic leak detectors, machine condition monitoring systems and associated sub-assemblies; vibration analysers and computerized alignments systems." 4. Respondent No.2, for the purpose of setting up a crude petroleum refinery was required to make erections at 28 different locations. For the said purpose, it entered into a contract with M/s. Europa BV of Holland on or about 23.10.1997 with effect from 20.11.1997 for supply of the crane and the trailer. Pursuant to and in furtherance of the said contract, a heavy duty platform ringer mobile crane and other equipments were imported on or about 31.1.1998 wherefor the bill of entr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uty Platform Ringer Mobile Crane & Grover MZ 90 Skyworker Mobile Crane". The description itself suggests that is a mobile crane. The invoices describe them as mobile crane and also the Chartered Engineer who has issued a certificate about the valuation and other technicalities of the imported goods has mentioned the goods as mobile crane. The purpose of importing these goods is that the appellants were in the process of setting up a crude petroleum refinery and they required the work of erection to be done at various points and to carry the load to different locations, a crane was required, as the crane which would carry such heavy load, could not remain static, for the purpose of providing mobility to the crane, 8 SPMTS i.e. self propelled modular transport system have been provided, this crane is mounted on the 8 SPMTS. The intention of the appellants is very clear that they have imported mobile crane. The said mobile crane was disassembled by the supplier while dispatching the same for the sake of convenience in transport and the same has been re-assembled at the site. It appears that this has been misunderstood by the lower authority and it has been held that these are two sepa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nition and is therefore, also covered under Sr.No.18 of the notification which covers all types of material handling equipments and is exempt from the duties specified thereunder." On the question of valuation, it was held : "In this regard, I find that the addition of 1% of the value of the imported goods towards the transportation charges for bringing the goods from anchorage to jetty has no sanctity of law. The appellants have included 1% landing charges in the assessable value of goods for import of goods, which is evident from the bill of entry. Further adding 1% is in contravention of Rule 9(2)(b) of the Valuation Rules. In this regard, the appellants have placed reliance on the judgment of the Hon'ble Supreme Court in the case of Coromandel Fertilizers Ltd. (supra) wherein the Apex Court has held that landing charges when assessed at a percentage, Customs cannot add any amount thereto on the ground that expenses for unloading were not covered in the landing charges, since they cover the totality of all that an importer expends for bringing imported goods from ship to land. Further, I find that for resorting to Rule 5 of the Customs Valuation Rules, 1988, the value can be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts have remitted any extra payments clandestinely to the foreign suppliers over above the invoice value. In absence of such allegation, there is no justification in resorting to Rule 5 of the Valuation Rules, without adequate comparable goods. Accordingly, there is no legal justification in enhancing the value of the imported goods. Especially so in the present case, because the goods imported are second hand goods and there is a provision under EXIM policy as could be seen from the Handbook of Procedures 1997 - 2002, in para 5.4 it has been said that actual user shall, inter alia, furnish a certificate from any of the Inspection and Certification Agencies listed in Appendix 32A, where the CIF value of the imported goods is Rs.one crore and above, certifying the residual life of the capital goods and reasonability of the purchase price. In accordance with this proviso, the appellants have obtained and produced a certificate from a Chartered Enginer, whose name appears at Sr.No.6 of Appendix 32A, wherein he has certified the fair market value of the goods, which is the same as has been declared by the appellants. Therefor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rent sites would be a Mobile Crane." It was observed : "Surely all elements/components as envisaged under note 3 to Section XVI cannot work simultaneously all the time. A component machine will function only when the ascribed function is called for. Propelling base SPMTs would be called for in use to change the location in this case and change in location need not be with the load lifted since it is not a traveling crane. The importer of SPMTs is admittedly is to import mobility to the Crane to operate at different places. A 'mobile crane' as would be understood has to be a crane which can move and relocate; as to how it functions at different sides i.e. mounted on its propelling mechanism or otherwise or partly on the propelling mechanism or otherwise or partly on the propelling mechanism and partly on jacks to gain leverage for lifting will not disentitle it from being 'mobile'. It was concluded : (i) Comparison from the Technical literature and then comparing the present import with the values of a Crawler Crane CC- 12600 an accepted Mobile Crane imported at Jawahar Custom House to be identical and similar to goods herein only on the grounds of Lifting Cap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould not have been possible and only for that purpose, such a material handling equipment, as per the definition contained in the said notification No.11/97 as amended by notification No.55/97 had to be imported. 18. The notification must be interpreted in a broad manner. Exemption had been granted to a large number of goods specified in List 8A required for setting up crude petroleum refinery. The project evidently was a huge one. In List 8A, as many as 45 items were listed. Some of the headings are overlapping. Item Nos.16 and 18 wherewith we are concerned use the word 'all types of materials' and 'all types of material handling equipments'. The fact that there are two parts in the crane in question is not in dispute. The fact that two parts thereof were manufactured by two different manufacturers is also not in dispute. It is also not in dispute that the respondent had imported the same as a second hand item from the same party. It was to be used as a crane and/or a material handling equipment. The findings of fact, as noticed hereinbefore, were arrived at by the Commissioner (Appeals) as also by the Tribunal. TheCommissioner (Appeals), while accepting the respondent's c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lost sight of. The Central Government must be held to be aware, if not of the equipment itself, but about the nature thereof which would be required for setting up a crude oil refinery. We are not oblivious of the proposition of law that an exemption notification should be construed directly but it is also well settled that interpretation of an exemption notification would depend upon the nature and extent thereof. The terminologies used in the notification would have an important role to play. Where the exemption notification ex facie applies, there is no reason as to why the purport thereof would be limited by giving a strict construction thereto. 21. The comparison made by the learned Solicitor General that mobility of a person would depend upon his personal fitness and not when he is placed on a wheelchair, in our opinion, is not apposite. The purpose of grant of exemption is different. The object for grant of notification shall be considered in a broad based manner. The wordings used therein have to be given its natural meaning. The purpose must be allowed to be achieved. The words 'all types of materials' should be construed widely. 22. We, therefore, are of the opinion t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
