Customs exemption for drawings and engineering plans upheld where the term "plans" was read broadly.
A customs exemption notification using the expression "plans" was read in its commercial and dictionary sense to include drawings, so imported basic engineering, drawings and technical know-how under a collaboration agreement qualified for auxiliary duty exemption. The Tribunal held that designs and drawings could not be excluded merely because they were separately described, and that the notification should not be given a narrow construction inconsistent with its ordinary meaning. On that basis, the imported goods fell within Notification No. 112/87 and exemption from auxiliary duty of customs was available.
Issues: Whether imported basic engineering, drawings and technical know-how were eligible for exemption from auxiliary duty of customs under Notification No. 112/87 dated 01.03.1987.
Analysis: The Tribunal applied its earlier view that the term "plans" in Notification No. 112/87 is wide enough to include drawings. It held that the notification entry should be construed in accordance with its true commercial and dictionary meaning, and that designs and drawings cannot be excluded merely because they are described separately. On that basis, basic engineering and drawings imported under the collaboration agreement fell within the exempted entry.
Conclusion: The imported goods were covered by Notification No. 112/87 and were eligible for exemption from auxiliary duty of customs.
Final Conclusion: The order denying exemption was set aside and the appeal succeeded, with consequential relief to follow.
Ratio Decidendi: Where a customs exemption notification uses the expression "plans", it may include drawings if the statutory context and ordinary meaning so require, and the exemption cannot be denied by a narrow reading of the entry.
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AI Drafter ✕
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