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of <h1>Clarification on Customs Duty Exemption Compliance and Liability Enforcement</h1> <h3>The Union of India 5 Others Versus Seahorse Hospitals Limited, Formerly known as Advanced Medical Care Limited</h3> The Union of India 5 Others Versus Seahorse Hospitals Limited, Formerly known as Advanced Medical Care Limited - 2016 (338) E.L.T. 661 (Mad.) Issues:- Compliance with conditions of Customs Notification No.64/88 for duty exemption- Enforcement of liability post-rescission of Notification No.64/88Compliance with conditions of Customs Notification No.64/88 for duty exemption:The case involved a public limited company operating a hospital seeking benefit under Notification No.64/88 for duty exemption on sophisticated machines. The company fulfilled conditions like providing free treatment to a percentage of patients based on income levels and bed reservations. However, a change in management led to challenges in maintaining records. Despite efforts to comply and conduct awareness programs, a field inquiry in 1998 revealed non-compliance for the years 1995 to 1998. The company's Customs Duty Exemption Certificates were canceled, leading to a legal challenge.Enforcement of liability post-rescission of Notification No.64/88:The central issue was whether authorities could enforce liabilities after the rescission of Notification No.64/88. Citing Supreme Court judgments, the court clarified that obligations under the notification were binding only during its enforcement period (1988-1994). The court referred to cases emphasizing that the substitution of statutory provisions repeals the old rule and introduces a new one. Therefore, the authorities erred in canceling the duty exemption certificates for non-compliance post-rescission in 1994. The court dismissed the appeal, upholding the single judge's decision based on previous legal precedents.In conclusion, the judgment focused on the company's compliance with Customs Notification No.64/88 conditions for duty exemption and the enforcement of liabilities post-rescission. The court emphasized the binding nature of obligations during the notification period and dismissed the appeal, affirming the single judge's decision based on legal precedents.
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