Project import relief turns on expansion of the specific industrial unit, not the plant's overall capacity.

Heading 9801 applies to machinery used for the initial setting up or substantial expansion of a specific industrial unit, and the term "unit" is construed as a self-contained part of a plant with an independent function. On that approach, concessional project import treatment must be tested against the expansion of the particular unit for which the machinery was imported, not against the factory's overall production capacity. The text also notes that the factual record did not clearly establish expansion of the relevant unit, so verification of that aspect remained necessary and the matter was remanded for fresh decision.

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Issues: Whether concessional project import treatment could be denied by examining the overall production capacity of the industrial plant instead of the expansion of the specific unit for which the machinery was imported.

Analysis: Heading 9801 applies to machinery required for the initial setting up of a unit or the substantial expansion of an existing unit of a specified industrial plant. The expression "unit" is to be understood as a self-contained portion of an industrial plant having an independent function. On that construction, the relevant enquiry was whether the machinery was imported for expansion of the High Tensile Stranded Low Relaxation Wires unit, and not whether the factory's overall production capacity had increased. At the same time, the record before the lower authorities did not clearly establish the capacity expansion of that specific unit, and verification on that factual aspect was necessary.

Conclusion: The interpretation adopted by the appellant was accepted, but the matter required factual verification and was remanded to the original authority for a fresh decision.

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