Exemption claims not examined at original stage require fresh adjudication, while an unpursued customs demand may be sustained.

A claim for exemption under Notification No. 65/88-Cus. in respect of Electromyography had not been examined by the original authority, so the matter required fresh adjudication at that stage in accordance with law and natural justice. By contrast, the customs duty demand relating to the Probe for Ultra Sound Scanner, where the challenge was not separately pursued on the relevant ground and the exemption had already been denied under Notification No. 64/88-Cus., was sustained.

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Issues: (i) Whether the benefit of Notification No. 65/88-Cus. dated 1-3-1988 was available to the item described as Electromyography; and (ii) whether the demand of customs duty in respect of Probe for Ultra Sound Scanner, denied the benefit of Notification No. 64/88-Cus. dated 1-3-1988, was sustainable.

Issue (i): Whether the benefit of Notification No. 65/88-Cus. dated 1-3-1988 was available to the item described as Electromyography.

Analysis: The claim under Notification No. 65/88-Cus. had been raised before the first appellate authority and again before the Tribunal, but it had not been examined by the original authority. Since the question of admissibility of the concessional rate of duty under that notification had not arisen before the original authority, that authority had no occasion to apply its mind to the claim. The matter therefore required adjudication at the original stage, in accordance with law and the principles of natural justice.

Conclusion: The issue was remanded to the original authority for fresh adjudication on the availability of the benefit under Notification No. 65/88-Cus. to Electromyography.

Issue (ii): Whether the demand of customs duty in respect of Probe for Ultra Sound Scanner, denied the benefit of Notification No. 64/88-Cus. dated 1-3-1988, was sustainable.

Analysis: The challenge concerning the Probe for Ultra Sound Scanner was not pursued by way of any plea requiring rectification, and no claim under Notification No. 65/88-Cus. had been raised before the Tribunal in respect of that item. The demand had already been sustained on the basis of the Larger Bench decision covering the exemption under Notification No. 64/88-Cus.

Conclusion: The demand of customs duty in respect of Probe for Ultra Sound Scanner was affirmed.

Final Conclusion: The exemption claim for Electromyography required fresh adjudication by the original authority, while the duty demand relating to Probe for Ultra Sound Scanner remained sustained.

Ratio Decidendi: Where an exemption claim has not been examined by the original authority, the matter should be remanded for adjudication at that level in accordance with law and natural justice, while a separate duty demand not independently challenged on the relevant ground may be affirmed.

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