Strict construction of exemption notifications: separate machine units were not treated as one automatic nut making machine.

An exemption notification for an automatic multi-station bolt or nut making machine was construed strictly by its own language. Two imported units performing separate stages of manufacture, with manual transfer of work in process between them, were not treated as one fully automatic machine, so the blanking press did not qualify for exemption. Licensing descriptions, DGTD opinion, Section XVI notes, and tariff interpretation rules were held not to govern the meaning of the exemption notification. The authorities' grant of exemption only to the finishing press was therefore regarded as rational.

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Issues: Whether the imported blanking press and finishing press together constituted one automatic multi-station nut making machine entitled to exemption under Notification No. 40/78-Cus.; whether the licensing description, DGTD opinion, and tariff section notes could govern interpretation of the exemption notification.

Analysis: The exemption notification covered an automatic multi-station bolt or nut making machine. The imported goods were two distinct machines performing separate stages, and manual movement of the work in process between the two units showed that the operation was not a single fully automatic machine. The language of the notification was held to be clear, and exemption notifications must be construed according to their terms and not by importing intendment. The licensing treatment, DGTD opinion, Section XVI notes, and the Rules for Interpretation of the Tariff Schedule were held not to control the interpretation of the exemption notification. The authorities granting exemption only to the finishing press were found to have acted on a rational basis.

Conclusion: The imported equipment did not qualify as one automatic multi-station nut making machine under Notification No. 40/78-Cus., and the exemption was not admissible to the blanking press; the challenge failed.

Ratio Decidendi: An exemption notification must be interpreted strictly by its own language, and two separate machines performing different stages of manufacture cannot be treated as one automatic machine unless the notification clearly so permits.

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