2001 (4) TMI 397 - AT - Customs

Diagnostic center granted exemption for imported equipment; inpatient facilities not required. Installation cert conditions clarified.

The appellant, a diagnostic center without indoor hospital facilities, was found eligible for the exemption under Notification 64/88 for imported ... Hospital equipments Issues:1. Eligibility for benefit of exemption under Notification 64/88 for imported treadmill systems and accessories.2. Requirement of installation certificate under the notification.3. Compliance with the condition of providing free treatment to outdoor patients.Eligibility for Benefit of Exemption:The Commissioner held that the appellant, a diagnostic centre without indoor hospital facilities, was not eligible for the exemption under Notification 64/88 for imported treadmill systems and accessories. The appellant argued that the conditions should not apply, providing evidence through patients' registers to show compliance with the requirement of free treatment to outdoor patients. Referring to previous decisions, it was established that the benefit of the notification should not be denied solely based on the lack of inpatient facilities. The Tribunal's decision in Surlux Diagnostic Ltd. case was cited as precedent, emphasizing that the notification extends to diagnostic centers. This interpretation was further supported by the decision in Gujarat Imaging & Research Institute case. Therefore, denial of the benefit on this ground was deemed unjustified.Requirement of Installation Certificate:The issue of the installation certificate requirement was addressed by citing the Tribunal's decision in St. Stephens Hospital case. It was clarified that the installation certificate condition does not apply to hospitals already in existence, as it pertains to establishments yet to be functional. The appellant was to provide evidence that the diagnostic center was operational before the import of goods to satisfy this condition. Although the Public Health Department's letter suggested the center's existence, conclusive proof was lacking. The appellant expressed readiness to present sufficient evidence supporting the center's pre-import existence, which, if established, would negate the denial of the notification benefit based on the absence of the installation certificate.Compliance with Free Treatment Condition:In response to the show cause notice, the appellant claimed to have provided free treatment to 40% of outdoor patients, supported by patient registers submitted to the Commissioner. However, the Commissioner did not consider this contention and concluded non-compliance without providing reasons. The Tribunal highlighted the importance of assessing this aspect, stating that the Commissioner should have evaluated it initially. Consequently, the appeal was allowed, and the impugned order was set aside, directing the Commissioner to reconsider both aspects in accordance with the law.In conclusion, the judgment addressed the issues of eligibility for exemption under Notification 64/88, the installation certificate requirement, and compliance with the free treatment condition for outdoor patients. The Tribunal emphasized the applicability of the notification to diagnostic centers, clarified the installation certificate condition for existing hospitals, and stressed the need for a thorough consideration of evidence regarding free treatment provision.