Customs exemption for toll barriers upheld where importer was the toll-collection contractor under the road project contract.

Imported toll barriers used for road toll collection fell within the relevant entry of Notification No. 21/2002-Cus., and the exemption was available where contractual documents showed the importer was the contractor engaged in toll collection under a tripartite arrangement. The Tribunal applied the earlier view that a contractor awarded road-related work by a State-controlled corporation could claim the notification benefit, and the exemption had to be read in light of the actual contractual context. On that basis, denial of exemption was unsustainable and the assessment was set aside.

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Issues: Whether the importer was entitled to exemption under Notification No. 21/2002-Cus. for toll barriers imported for installation on road projects, on the ground that it was a contractor engaged in toll collection under a tripartite arrangement.

Analysis: The imported goods were used for toll collection on roads and were covered by the relevant entry in the notification. The contractual documents showed that the appellant was the contractor for toll collection and had sub-contracted the activity further. The Tribunal applied the earlier view that a person awarded a contract by a road construction corporation under State control could avail the exemption, and that the notification had to be read according to its terms in the factual context of the contract.

Conclusion: The appellant satisfied the notification conditions and the exemption could not be denied.

Final Conclusion: The denial of exemption was unsustainable, and the appeal succeeded with the assessment set aside.

Ratio Decidendi: Where imported goods fall within the specified entry of a customs exemption notification and the importer is shown to be the contractor for the covered road-related work, the exemption cannot be denied on a narrow reading of the contractual description.

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