1996 (10) TMI 320 - AT - Customs

Customs Tribunal Upholds Classification of Uninterruptible Power Supply (UPS) under Project Import

The Tribunal upheld the Collector of Customs' order regarding the classification of Uninterruptible Power Supply (UPS) under Project Import against an ... Import - Redemption fine Issues:1. Classification of Uninterruptible Power Supply (UPS) under Project Import against an Import Licence.2. Confiscation of goods by the Collector of Customs and imposition of redemption fine.3. Argument regarding the essentiality of UPS for micro-processor based instrumentation.4. Request for leniency based on previous imports and license coverage.Classification of Uninterruptible Power Supply (UPS):The appeal challenged the Collector of Customs' order regarding the classification of UPS under Project Import against an Import Licence. The Collector held that UPS, while essential for ensuring power supply in case of failure, is not inherently part of the computer/micro process system. The appellants argued that UPS is crucial for the entire micro-processor based instrumentation system to prevent irreparable damage. However, the Tribunal found that while UPS is essential for the equipment described, it cannot be considered a part of it. The absence of UPS could lead to significant loss, but that alone does not make it an integral part of the equipment. The appellants failed to provide clarification from the Licensing Authority regarding the admissibility of UPS under the license.Confiscation and Redemption Fine:The Collector confiscated the goods but allowed redemption upon payment of a fine. The appellants contended that UPS was part of the consignment imported for Project Imports and highlighted the provisional nature of the assessment. They also pointed out previous instances where UPS was imported without objections. The Tribunal acknowledged the previous import history and reduced the redemption fine from Rs. 1,60,000 to Rs. 75,000, considering the past clearance of similar goods without issues.Essentiality of UPS for Micro-Processor Based Instrumentation:The appellants argued that UPS is essential for the proper functioning of the sophisticated micro-processor based instrumentation system, emphasizing its role in preventing damage to the equipment. They claimed that UPS was included in the consignment imported for Project Imports and covered under the Equipment Supply Agreement. However, the Tribunal maintained that while UPS is crucial for ensuring power supply, it does not qualify as a part of the equipment itself.Leniency Request and Previous Imports:In a plea for leniency, the appellants highlighted the bona fide nature of the imports and the historical clearance of UPS under the same license for a previous plant control system. They urged for a reduction in the redemption fine based on these grounds. The Tribunal considered the previous import history and reduced the redemption fine in light of the past clearance of UPS without objections.In conclusion, the Tribunal upheld the impugned order with modifications, reducing the redemption fine while rejecting the appeal on other grounds.