2003 (3) TMI 385 - AT - Customs

Tribunal remands case on technical know-how classification & Notification No. 25/95, calls for detailed speaking order.

The Tribunal set aside the Commissioner's order and remanded the case for further consideration regarding the classification of imported technical ... Valuation - Words and Phrases - Manual - Appeal by Department - Authorisation - Demand Issues Involved:1. Classification and Duty Liability of Imported Technical Know-How Documents2. Applicability of Notification No. 25/95-Cus., dated 16-3-953. Validity of the Appeal Filed by the Commissioner of Customs, Chennai4. Confiscation of Goods and Imposition of PenaltyDetailed Analysis:1. Classification and Duty Liability of Imported Technical Know-How Documents:The primary issue was whether the technical know-how documents imported by the respondents could be classified as 'Printed Manuals in loose leaf-form' under heading 4901.99 of the Customs Tariff Act, 1975, and if they were liable for customs duty. The Revenue argued that the documents could not be classified under 'Printed Manual in loose leaf documents' and thus were not eligible for the benefit of Notification No. 25/95. The Commissioner had initially treated the documents as manuals and extended the benefit of the notification, but the Revenue appealed this decision, arguing that the sum paid for the technical know-how should be considered as the transaction value under Section 14 of the Customs Act, 1962, and duty should be demanded accordingly.2. Applicability of Notification No. 25/95-Cus., dated 16-3-95:The respondents contended that the technical know-how documents in loose leaf form should be classified as manuals and thus be eligible for exemption under Notification No. 25/95. The Commissioner had agreed with this view, but the Revenue cited the Supreme Court judgment in CC, New Delhi v. Parasrampuria Synthetics Ltd., which held that printed drawings, designs, and plans under a Foreign Transfer of Technology Agreement could not be classified as printed books or manuals for the purpose of the said notification. The Tribunal found that the technical know-how documents did not meet the characteristics of a book or manual as commonly understood and thus were not eligible for the exemption.3. Validity of the Appeal Filed by the Commissioner of Customs, Chennai:The respondents argued that the appeal was invalid because the Central Board of Excise & Customs had authorized the Commissioner of Customs (Airport) to file the appeal, but it was filed by the Commissioner of Customs, Chennai. The Tribunal rejected this plea, noting that the appeal was authorized by the proper officer and the omission of the word 'Airport' in the appeal form did not affect its validity.4. Confiscation of Goods and Imposition of Penalty:The Revenue had initiated proceedings to demand duty and impose penalties under Section 114A of the Customs Act, 1962, arguing that the respondents had evaded customs duty by not declaring the technical know-how documents. The Commissioner had dropped these charges, but the Tribunal found that the documents were brought into the country clandestinely to evade customs duty and thus were liable for confiscation. The Tribunal set aside the Commissioner's order and allowed the Revenue's appeal, holding that the exemption under Notification No. 25/95 was not applicable.Separate Judgments Delivered:- Majority Opinion (Member Technical and Member Judicial): The majority held that the matter should be remanded for de novo consideration, as the Commissioner's order was non-speaking and did not adequately address the classification and valuation of the technical know-how documents.- Dissenting Opinion (Member Judicial): One member opined that the matter should be reconsidered in light of the Supreme Court judgment and the detailed findings required on the classification and applicability of the notification.Conclusion:The Tribunal, by majority order, set aside the Commissioner's order and remanded the matter for de novo consideration to examine the classification of the technical know-how documents and the applicability of Notification No. 25/95 in light of the Supreme Court judgment. The Commissioner was directed to provide a detailed speaking order after allowing the respondents to submit necessary documents and arguments.