2000 (10) TMI 385 - Commissioner - Customs

Customs appeal granted due to government control in shareholding structure.

The Commissioner set aside the lower authority's order and allowed the appeal, finding the denial of benefits unjustified and granting consequential ... All the condition of the Notification No. 23/98-Cus. are satisfied. Issues:Denial of benefit of Notification 23/98-Cus. to imported goods for fire fighting and rescue operations by the adjudicating authority.Analysis:The appeal was filed against the order-in-original denying the benefit of Notification 23/98-Cus. for special purpose motor vehicles and hydraulic platforms for fire fighting and rescue operations at various chemical and fertilizer plants. The appellants contended that they met the mandatory conditions of the notification and should not be denied the exemption. The term 'fire services' in the notification was argued to cover all fire fighting equipment imported by government-controlled units, not just fire brigade services.The key issue revolved around the shareholding structure of the appellant company. The Customs Appraising Officer argued that since the Government of Gujarat held only a 150 shareholding, the appellant did not qualify as a State Controlled Organization. The appellant countered by pointing out that most directors were IAS officers of the Gujarat Cadre, indicating state government control. The Commissioner observed that the lower authority focused on equity shareholding to deny the benefit of the notification, despite the goods falling under the specified list and the appellant being certified by the Ministry of Chemicals and Fertilizers.The Commissioner emphasized that once the mandatory conditions of a notification are met, Customs authorities cannot challenge the certifying authority's decision. The certificates issued by the Deputy Secretary, Ministry of Home Affairs, were deemed sufficient proof of compliance. The composition of the appellant's board of directors further supported the argument that they were not a private entity but controlled by government bodies. Consequently, the Commissioner set aside the lower authority's order and allowed the appeal, finding the denial of benefits unjustified and granting consequential relief to the appellant.