Hotel lighting equipment qualifies as EPCG capital goods, securing customs exemption under the relevant notifications.

Chandeliers and light fittings imported by a hotel under the EPCG scheme were treated as capital goods eligible for exemption under Customs Notifications No. 28/97-Cus. and No. 29/97-Cus. The notifications were read in light of hotel industry requirements, and lighting equipment was specifically listed in the annexure to Notification No. 29/97-Cus. Because the imported items were covered by the EPCG licences and were equipment or accessories required for rendering hotel services, the denial of exemption was found unsustainable. The assessee was therefore entitled to the benefit of both notifications.

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Issues: Whether chandeliers and light fittings imported by a hotel under the EPCG scheme qualified as capital goods eligible for the benefit of Customs Notifications No. 28/97-Cus. and No. 29/97-Cus.

Analysis: The imported items were admittedly covered by the EPCG licences. Under Notification No. 28/97-Cus., capital goods included plant, machinery, equipment and accessories required for rendering services, and under Notification No. 29/97-Cus. the hotel industry was eligible to import such goods as specified in the annexure. The notifications were read in the context of hotel industry requirements, and lighting equipment was specifically listed in the annexure to Notification No. 29/97-Cus. Chandeliers and light fittings were held to be equipment or accessories required for rendering hotel services, and the assessee was otherwise compliant with the EPCG scheme.

Conclusion: The denial of exemption was unsustainable, and the assessee was entitled to the benefit of both notifications.

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