CKD and SKD components in a complete pollution control system can qualify for concessional duty exemption.

Notification No. 78/90-C.E. granted concessional duty to specified pollution control equipment where the prescribed certification showed the goods were intended for pollution control purposes. The Board's Section 37B order clarified that machinery, components, equipment, instruments and apparatus cleared in CKD or SKD condition could still qualify if they formed part of a complete pollution control system and supporting evidence was produced. On the facts, the certificate, purchase order and contract established supply of a complete scrubbing system, so exemption was available and denial of the benefit was unjustified.

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Issues: Whether the scrubbing system cleared in CKD/SKD condition, along with its parts and components, was entitled to the benefit of Notification No. 78/90-C.E., and whether the notification exemption could be denied on the ground that only the complete system and not the parts were specified.

Analysis: The notification granted concessional duty to specified pollution control equipment subject to certification by an officer not below the rank of Deputy Secretary in the Ministry of Environment and Forests that the goods were intended for pollution control purposes. The assessee produced the required certificate. The Board's Section 37B order also clarified that the benefit of the notification would extend to machinery, components, equipment, instruments and apparatus cleared in CKD or SKD condition, provided they formed part of a complete pollution control equipment or system and the requisite evidence was produced. The purchase order and the contract showed supply of a complete scrubbing system, and the notification was construed so as not to defeat its object.

Conclusion: The scrubbing system, including its components cleared in CKD/SKD condition, was eligible for the benefit of Notification No. 78/90-C.E. The denial of exemption was unjustified.

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