Appellant's Duty Demand Denied Over Factory Premises Issue

The appellant's demand of duty was confirmed due to the denial of the benefit of Notification No.110/95-Cus. The Tribunal found that the imported goods were installed in the laboratory, not the factory premises as required by the notification's condition. Despite the appellant's argument that the laboratory should be considered part of the factory, the Tribunal upheld the decision, stating that the condition was clear. The Tribunal also clarified that a letter from DGFT modifying the import license did not grant permission for installation in the laboratory. The appeal was rejected based on these findings.

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Issues:
1. Denial of benefit of Notification No.110/95-Cus. due to non-fulfillment of condition No. 6.
2. Interpretation of condition No. 6 regarding installation of capital goods in the factory.
3. Argument regarding the laboratory being considered part of the factory premises.
4. Relevance of the letter from DGFT in modifying the import license.
5. Bar on limitation for issuing show cause notice beyond six months.

Analysis:
1. The appellant's demand of duty was confirmed at Rs.2,59,939/- along with interest due to the denial of the benefit of Notification No.110/95-Cus., citing non-satisfaction of condition No. 6. The condition required the imported capital goods to be installed in the importer's factory and certified by the Assistant Commissioner of Central Excise within six months from completion of imports.

2. The Tribunal observed that the imported goods, "High Performance Liquid Chromatography Machine," were installed in the appellant's laboratory, not the factory premises. The appellant argued that the laboratory was part of their R & D unit, conducting tests on raw materials and improving efficiency. However, the condition clearly stated that goods should be installed in the factory, leading to the denial of the benefit under the notification.

3. The appellant contended that the laboratory should be considered part of the factory premises, but the Tribunal held that the language of the notification was unambiguous. The condition required installation in the factory, and the goods being in the laboratory did not fulfill this requirement, thus upholding the lower authorities' decision.

4. The appellant referred to a letter from DGFT modifying the import license regarding the installation location of the goods. However, the Tribunal found the letter did not grant permission for installation in the laboratory. The issuance of the license by DGFT was a separate condition from the installation requirement under the Customs notification.

5. Regarding the limitation on issuing show cause notice beyond six months, the Tribunal noted that the installation period could extend beyond the limitation period as per the condition. Since the installation was covered by bonds entered into by the appellant, the demand was confirmed in line with the bond terms and not barred by limitation. Consequently, the appeal was rejected based on the above analysis.

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