1995 (5) TMI 174 - AT - Customs

Tribunal rules against exemption for imported fabrics for ship fire fighting suits

The Tribunal ruled in favor of the Revenue, overturning the Collector of Customs (Appeals) decision. It held that the aluminised glass fibre fabrics ... Fire proof fabrics Issues:Applicability of exemption Notifications No. 195/76-Cus. and 291/84-Cus. to aluminised glass fibre fabrics imported for manufacturing fire fighting suits for ships.Analysis:The case involved a dispute over the applicability of exemption Notifications No. 195/76-Cus. and 291/84-Cus. to aluminised glass fibre fabrics imported for making fire fighting suits for ships. The Revenue contended that the fabrics were not for fitment to the ships, while the importers argued that the suits were essential ship equipment. The Assistant Collector of Customs initially denied the exemption, stating the fabrics were not for ship construction or fitment. However, the Collector of Customs (Appeals) reversed this decision, considering the fire fighting suits as fitment to the ships under the safety regulations.The Tribunal analyzed the definitions of 'fitment to the ships' and emphasized that for an item to be considered fitment, it must physically become part of the ship, serving its navigation or safety. The Tribunal referred to precedents like the Amkar Engineering Works case, where accessories were distinguished from integral parts, and the Steel Crafts case, where non-detachable items were considered part of the main product. The Tribunal highlighted that the exemption under the notifications is strictly construed, requiring goods to be necessary for ship construction or fitment.Ultimately, the Tribunal found that the aluminised glass fibre fabrics, imported in running length for making fire fighting suits, did not meet the criteria for exemption. The fabrics were not physically attached to the ships and were personal protective equipment worn by individuals, not permanently affixed to the ship. The Tribunal upheld the Revenue's appeal, setting aside the Collector of Customs (Appeals) decision. The Tribunal concluded that the fabrics did not qualify as fitment to the ships under the exemption notifications' strict interpretation.In conclusion, the Tribunal allowed the Revenue's appeal, overturning the Collector of Customs (Appeals) decision. The judgment highlighted the strict interpretation required for exemption notifications, emphasizing the necessity for goods to be directly related to ship construction or fitment to qualify for exemption. The Tribunal's analysis focused on the physical attachment and essentiality of items to the ship for them to be considered fitment, ultimately determining that the imported fabrics for fire fighting suits did not meet the exemption criteria.