Inclusive definition of "Hospital" may cover a diagnostic centre, but exemption fails once the certificate is withdrawn.

The notification's inclusive definition of "Hospital" was wide enough to cover a diagnostic centre because it expressly extended to institutions, centres, trusts, societies, laboratories, clinics and maternity homes rendering medical, surgical or diagnostic treatment. However, exemption under the notification depended on satisfaction of its conditions, and the benefit could not continue once the DGHS exemption certificate was withdrawn. As the withdrawal was not effectively challenged, the foundation for the customs exemption ceased to exist and the customs duty demand remained sustainable.

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Issues: Whether a diagnostic centre falls within the expression "Hospital" in Notification No. 63/88-CUS dated 01.03.1988 and, if so, whether customs duty exemption could be claimed after the exemption certificate issued by the DGHS was withdrawn.

Analysis: The notification granted exemption to specified hospital equipment and its explanation expressly defined "Hospital" to include an institution, centre, trust, society, association, laboratory, clinic and maternity home rendering medical, surgical or diagnostic treatment. The inclusive language enlarged the ordinary meaning of the expression and was capable of covering a diagnostic centre, but only if the other conditions of the notification were satisfied. The appellant had initially obtained an exemption certificate from the DGHS and the benefit of exemption was granted, but the certificate was later withdrawn by the same authority. Once the foundation for the exemption ceased to exist, the appellant could not insist on continued exemption from customs duty, especially when the withdrawal of the certificate was not effectively challenged.

Conclusion: A diagnostic centre could fall within the notification, but on the facts the appellant was not entitled to continue claiming exemption after withdrawal of the exemption certificate; the duty demand was sustainable.

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