Customs exemption for dual-function embroidery machine upheld where principal embroidery use fell within the notified entry.

An imported machine performing both embroidery and quilting functions was held eligible for customs exemption because the notification covered embroidery machines separately, and Board clarification allowed the principal function to determine eligibility. The existence of an additional quilting function did not justify denial where the main embroidery function fell within the notified entry, so the exemption was admissible and the denial of benefit was unsustainable.

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Issues: Whether an imported machine capable of performing both embroidery and quilting functions was entitled to exemption under Notification No. 21/02-Cus dated 01.03.2002.

Analysis: The notification granted exemption separately for embroidery machines and quilting machines. The machine in question performed both functions. Board clarification indicated that the main function of the machinery could be considered while extending the benefit of the notification. On that basis, the existence of an additional function did not justify denial of the exemption where the principal embroidery function fell within the notification entries.

Conclusion: The exemption was admissible and the denial of benefit was unsustainable.

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