Similar goods under Foreign Trade Policy construed broadly; stationary engines qualified for concessional duty despite different end use.

Where the Foreign Trade Policy, 2009-14 leaves "similar goods" undefined, the term must be construed in its ordinary and contextual sense by reference to the policy's object, and not by importing the definition used in the Customs Valuation Rules. The Tribunal held that "similar" means goods with general likeness or correspondence in many respects, not identity, and that different end use does not by itself negate similarity. On that basis, stationary engines cleared into the domestic tariff area by a 100% export oriented unit were treated as similar goods under paragraph 6.8, making the concessional duty under Notification No. 23/2003-CE available.

---

---

Issues: Whether stationary engines cleared into the domestic tariff area by a 100% export oriented unit were "similar goods" within paragraph 6.8 of the Foreign Trade Policy, 2009-14 so as to attract concessional duty under Notification No. 23/2003-CE dated 31.03.2003.

Analysis: The applicable test was the meaning of "similar goods" under the Foreign Trade Policy, 2009-14, not the meaning adopted in the Customs Valuation Rules. Since the Foreign Trade Policy and the notification did not define the expression, the term had to be understood in its ordinary and contextual sense, having regard to the object of the foreign trade regime. The Tribunal held that the customs valuation definition could not be imported into a different statutory setting. It further noted that "similar" does not mean identical, but denotes goods having a general likeness or corresponding in many respects. The fact that the engines were used for different end purposes did not destroy their essential similarity, and the scheme being beneficial in nature warranted a liberal construction.

Conclusion: The stationary engines were held to be similar goods under paragraph 6.8 of the Foreign Trade Policy, 2009-14, and the concessional rate of duty under Notification No. 23/2003-CE dated 31.03.2003 was held to be available. The demand, penalty, and the impugned order were set aside.

Ratio Decidendi: Where a term is left undefined in the Foreign Trade Policy, it must be construed in the policy's own context and object, and the meaning assigned to the same expression in the Customs Valuation Rules cannot be imported; "similar goods" denotes goods with general likeness and not identity, and end use alone does not negate similarity.

---