2017 (11) TMI 410 - AT - Customs

Appeal allowed for MRI scanner import under Served from India Scheme; exemption granted from Special Additional Duty.

KIMS Health Care Management Ltd. Versus Commissioner of Customs

The Tribunal allowed the appeal, setting aside the upheld Order-in-Original for the import of an MRI scanner under the Served from India Scheme. The ... Served from India Scheme - N/N. 92/04 Cus dated 10.09.2004 - SAD - Held that: - the only condition for exemption for SAD in N/N. 20/2006 Cus. is that the goods should be exempted from payment of basis Customs duty and countervailing duty - any of exemption notification nowhere states that the exemption should be unconditional. It is a fact that vide N/N. 92/2004 BCD is exempted subject to certain conditions. Further vide N/N. 6/2006 CVD is exempted. Further vide N/N. 20/2006 even the SAD leviable under Section 3(5) of the Customs Tariff Act was also exempted. During the relevant period, the impugned goods were fully exempted from basic customs duty as well as CVD (leviable under Section 3(1) of the Customs Tariff Act, 1975 and consequently the impugned goods were entitled to the benefit of N/N. 20/2006-Cus. Further in the case of Gujarat Ambuja Exports Ltd. Vs. UOI [2013 (6) TMI 536 - GUJARAT HIGH COURT] wherein the Hon’ble Gujarat High Court held that the imported goods were entitled to the benefit of N/N. 20/2006 Cus. when they (imported goods) were exempted from duty under Notification 45/2002-Cus. when imported under DEPB scheme where the duty is debited to the duty entitlement passbook. Appeal allowed - decided in favor of appellant. Issues:- Appeal against upheld Order-in-Original for import of MRI scanner under Served from India Scheme.- Exemption conditions under Notification No. 92/04 Cus. and related Notifications.- Interpretation of exemption provisions for basic Customs Duty, Additional Customs Duty, and Special Additional Duty.- Judicial precedents supporting appellant's position.- Exemption from Special Additional Duty under Notification 20/2006 Cus.- Applicability of exemption conditions for SAD under Notification 20/2006 Cus.Analysis:The appeal challenged the Commissioner (Appeals)'s decision upholding the Order-in-Original regarding the import of an MRI scanner under the Served from India Scheme. The appellant imported the scanner seeking clearance under Notification No. 92/04 Cus. The total assessable value was Rs. 3,59,37,288, with duty leviable at Rs. 33,43,605. The appellant claimed exemption under the Scheme, subject to specific conditions, including producing the served from India Scheme Certificate at clearance for debiting duties. The appellant contended that the impugned order overlooked legal provisions and binding judicial precedents. The appellant argued that the exemption under Notification 92/04 Cus. covered basic Customs Duty and Additional Customs Duty, which were already accounted for in the duty entitlement certificate, thus exempting the same.The appellant relied on various judicial decisions to support their interpretation, emphasizing the exemption of CVD under Section 3(1) of the Customs Tariff Act under Notification 6/2006 CE. The appellant argued that no special Additional duty of 4% was required as the goods were exempted from basic Customs duty and CVD. Conversely, the Assistant Commissioner reiterated the findings of the impugned order, leading to a thorough examination by the Tribunal.The Tribunal analyzed Notification 20/2006 Cus., which granted exemption from Special Additional Duty (SAD) under specific conditions. The Tribunal noted that the exemption was contingent upon goods being exempted from basic Customs duty and countervailing duty. The Tribunal highlighted that the exemption notifications did not specify unconditional exemption, and the goods were fully exempted from basic Customs duty and CVD during the relevant period. Citing a relevant precedent, the Tribunal concluded that the impugned order was unsustainable in law and allowed the appeal with consequential relief, setting aside the earlier decision.In conclusion, the Tribunal's detailed analysis of the exemption provisions under various notifications, supported by legal precedents, led to the reversal of the impugned order, emphasizing the correct interpretation of the exemption conditions and the entitlement of the appellant to the benefits under the relevant notifications.