TaxTMI 
TaxTMI 
2000 (8) TMI 318
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.... the imported hospital equipment and functioning of the hospital within a period of two years. Since such certificates from the prescribed authority namely DGHS or Ministry of Health and Family Welfare were not produced within the stipulated period, the Department issued show cause notice proposing recovery of duty of Rs. 36,91,763/- for non-fulfilment of post import conditions of Notification No. 64/88 and proposing recovery of interest and imposition of penalty as the goods had become liable to confiscation. 2. The Adjudicating Authority upheld the charges in the notice and confirmed duty demand together with interest and also imposed a penalty of Rs. 1 lakh on the appellants. Hence this appeal. 3. We have heard Shri M. Chandrashekhran, learned Sr. Advocate and Shri M.P. Singh, learned DR. Notification No. 64/88 is reproduced below : "Exemption to hospital equipments imported by specified category of hospitals (charitable) subject to certification from DGHS, etc. - In exercise of the powers conferred by sub-section (1) of Section 25 of the Customs Act, 1962 ( 52 of 1962), the Central Government, being satisfied that it is necessary in the public interest so to ....
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....able organisation as may be approved, from time to time, by the said Ministry of Health and Family Welfare. 2. All such hospitals which may be certified by the said Ministry of Health and Family Welfare, in each case, to be run for providing medical, surgical or diagnostic treatment not only without any distinction or caste, creed, race, religion or language but also, (a) free, on an average, to at least 40% of all their outdoor patients; and (b) free to all indoor patients belonging to families with an income of less than rupees five hundred per month and keeping for this purpose at least 10 percent of all the hospital beds reserved for such patients; and (c) at reasonable charges, either on the basis of the income of the patients concerned or otherwise, to patients other than those specified in clauses (a) and (b). 3. Any such hospital in respect of which the said Ministry of Health and Family Welfare, may, having regard to the type of medica....
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....mporter shall furnish certificates from the said Ministry of Health and Family Welfare or from the Directorate General of Health Services, Government of India, within such period as the Assistant Collector of Customs may specify in this behalf or within such extended period as the Assistant Collector of Customs, on sufficient cause being shown, may allow in each case, to the effect, (i) that such hospital equipment has been installed in the hospital; and (ii) that such hospital has started functioning. (c) the importer shall furnish, at the appropriate time, the certificates referred to in (b); (d) the importer executes a bond in such form and for such sum as may be specified by the Assistant Collector of Customs binding himself to pay, on demand, an amount equal to the duty leviable on the said hospital equal to the duty leviable on the said hospital equipment, (i) if such hospital starts functioning ....
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....eld to be applicable to an existing hospital but only to a hospital in the process of being established (covered by Sl. No. 4 of the table to the notification). For the above reasons, we hold that the requirement in clause (b) of the relevant proviso for production of certificate from the prescribed authorities is not applicable to the appellant which is a hospital covered by Sl. No. 2 of the table to the notification. The fact that the appellant executed a bond in terms of clause (d) will not alter the above position and the Revenue cannot enforce the bond which we hold is not required to be executed by the appellant hospital. The contention of the learned DR that the post importation conditions in the notification apply even to the appellant hospital, is not tenable. The apprehension on the part of the Revenue regarding non-installation of the imported equipment cleared duty free or misuse by diversion of the same from the hospital is belied by the fact that the appellants have produced certificate from M/s Toshniwal Bros. that the imported equipments were installed and are functioning in the appellant hospital together with the fact that there is no allegation or finding that th....