Customs exemption for UPS units upheld under notification covering static converters for data processing equipment

Imported uninterrupted power supply units were held to fall within the exemption entry for static converters used with automatic data processing machines and related telecommunication apparatus under Notification No. 25/2005-Cus. The Tribunal applied the notification as written and relied on its earlier ruling in the assessee's own case, supported by a consistent line of Division Bench decisions accepted by the department. On that basis, the goods were treated as covered by Serial No. 4 and the denial of basic customs duty exemption was unsustainable.

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Issues: Whether the imported uninterrupted power supply units were eligible for exemption from basic customs duty under Serial No. 4 of Notification No. 25/2005-Cus. dated 01.03.2005.

Analysis: The exemption entry covered static converters for automatic data processing machines and units thereof, and telecommunication apparatus other than static converters for cellular mobile phones. The Tribunal had already decided in the assessee's own case that the imported UPS fell within that description and were entitled to full exemption. Another Division Bench had taken the same view in a connected line of decisions, which had been accepted by the department. In a taxing exemption, the language of the notification must be applied as written, but on the facts the goods were covered by the exemption entry.

Conclusion: The denial of exemption was unsustainable and the assessee was entitled to the benefit of the notification.

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