Customs exemption for research imports fails where the commercial assessee, not the research unit, is shown as importer.

Customs exemption under Notification No. 70/81-Customs, issued under Section 25(1) of the Customs Act, was available only where scientific and technical instruments were imported by a qualifying research institution and the specified conditions were met, including that the institution was not engaged in commercial activity. The Supreme Court noted that the assessee's Research and Development Unit was only an internal unit, not an independent importer, and the Bills of Entry and invoices named the commercial assessee as importer. As the statutory condition that the import be by the research institution was not satisfied, the exemption claim was correctly rejected.

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Issues: Whether the customs exemption available under Notification No. 70/81-Customs applied when the goods were imported in the name of the assessee and not in the name of its Research and Development Unit.

Analysis: The exemption under the notification issued under Section 25(1) of the Customs Act, 1962 was available to scientific and technical instruments imported by a research institution, subject to the specified conditions, including that the institution should not be engaged in commercial activity. The Research and Development Unit was found to be only a unit within the assessee's establishment and not an independent importer. The Bills of Entry and invoices showed the assessee, which was a commercial establishment, as the importer. On that basis, the condition requiring import by the research institution was not satisfied.

Conclusion: The claim for exemption was rightly rejected and the issue was decided against the assessee.

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