Airport development exemption for pavement-testing equipment upheld; bona fide import also avoided confiscation under import policy

A pavement-testing system imported as a van-mounted heavy weight deflectometer with analysis software was treated as goods required for airport development because the notification covered runway marking and pavement testing machines and applied to goods under any chapter. Its essential function was non-destructive testing of runways, taxi tracks and aprons, so exemption was available even if it could be viewed as a special purpose motor vehicle. The import was also held not liable to confiscation, as the article was brought in bona fide for pavement testing and not as a prohibited motor vehicle import through a non-specified port.

---

---

Issues: (i) Whether the imported van-mounted heavy weight deflectometer and analysis computer programme was entitled to exemption under Notification No. 21/2002-Cus. as goods required for development of airports; (ii) whether the goods were liable to confiscation on the ground that import of a motor vehicle through a non-specified port violated the import policy.

Issue (i): Whether the imported van-mounted heavy weight deflectometer and analysis computer programme was entitled to exemption under Notification No. 21/2002-Cus. as goods required for development of airports.

Analysis: The notification granted exemption to goods specified in List 20 required for development of airports and expressly covered goods falling under Chapter 84 or any other chapter. List 20 included runway marking and pavement testing machines. The imported equipment was found to be a pavement testing system used for testing runways, taxi tracks and aprons at airports, and its technical specifications and the supporting material showed that its essential function was non-destructive pavement testing for airfield evaluation. Even if the goods were treated as a special purpose motor vehicle, they still remained covered because the notification was directed to pavement testing machines required for airport development and was not confined to any particular tariff heading.

Conclusion: The goods were covered by the notification and exemption was available to the assessee.

Issue (ii): Whether the goods were liable to confiscation on the ground that import of a motor vehicle through a non-specified port violated the import policy.

Analysis: The imported article was held to be a pavement testing system brought in under a bona fide belief that it was not a motor vehicle. The prior clearance of a similar runway marking machine and the functional character of the import supported the assessee's stand that the import was for pavement testing and not for import of a vehicle as such. In these circumstances, the allegation of breach of the port restriction under the import policy did not warrant confiscation.

Conclusion: The confiscation on the ground of violation of the import policy was not sustainable.

Final Conclusion: The impugned order was set aside and the appeal succeeded, with the imported equipment held eligible for exemption and not liable to confiscation.

Ratio Decidendi: Where an exemption notification covers airport-development goods specified by function and expressly applies to goods falling under any chapter, the actual functional use of the imported equipment governs entitlement to exemption, and a bona fide import of a pavement-testing system cannot be treated as a prohibited vehicle import for confiscation purposes.

---