Purposive construction of customs exemption extends to button parts used in export garments.

Parts of buttons imported for use in export garments were treated as within the scope of the customs exemption, because they formed an operational press button when fixed on the garment. The court applied a purposive construction to the exemption notification, noting that its object was to support export competitiveness and benefit bona fide exporters. The exemption was not to be denied merely because the buttons were imported in disassembled form rather than as a finished article. The assessee was therefore entitled to the duty benefit.

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Issues: Whether parts of buttons imported for use in making export garments were eligible for duty exemption under Notification No. 21/2002-Customs dated 01.03.2002.

Analysis: The imported items were not complete buttons in the assembled form, but the record showed that the parts, when fixed on the garment, formed an operational press button. The exemption notification covered buttons imported by bona fide exporters, and the object of the notification was to facilitate export competitiveness. The notification was construed purposively so that the benefit was not denied merely because the buttons were imported in parts rather than as a finished article.

Conclusion: The parts of buttons were held to fall within the scope of the exemption notification, and the assessee was entitled to the duty benefit.

Ratio Decidendi: A tax exemption notification intended to promote exports must be construed purposively, and eligible components that together constitute the exempted article on use cannot be denied the benefit merely because they are imported in disassembled form.

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