Strict construction of exemption notification denied customs relief for imported sub-systems of a digital exchange

Imported materials and sub-systems for a Digital Electronic International Gateway Exchange were held outside Notification No. 59/88-Cus. because Sl. No. (iv) 3 covered only the complete exchange and did not expressly include sub-systems. The notification used broader wording in other entries where sub-systems were intended, so the omission here was treated as deliberate. Since the goods were themselves described as materials for expansion and as sub-systems, and were classified as parts under the tariff, no exemption could be extended by implication or presumed legislative intent. The exemption claim therefore failed.

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Issues: Whether the imported materials and sub-systems for a Digital Electronic International Gateway Exchange were entitled to exemption under Notification No. 59/88-Cus. as goods falling within Sl. No. (iv) 3 of the table annexed thereto.

Analysis: The notification extended the exemption to the complete Digital Electronic International Gateway Exchange at Sl. No. (iv) 3, while in other entries it specifically referred to sub-systems where such coverage was intended. The imported goods were themselves described as materials for expansion and as sub-systems, and the claimant did not dispute their classification under the tariff heading covering parts. In the absence of any express inclusion of sub-systems under Sl. No. (iv) 3, the wording of the notification had to be applied as written and no exemption could be read into it on the basis of presumed legislative intent.

Conclusion: The imported sub-systems were not covered by the notification and the exemption claim failed, against the assessee.

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