TaxTMI 
TaxTMI 
2020 (7) TMI 93
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....ated investigations into the imports by the Appellant and statements of Shri M.S. Swaminathan, Authorised Signatory of the Appellant and Shri Kulveen Singh Bali, Head, Regulatory Affairs and Quality Assurance of the Appellants were recorded. A Show Cause Notice dated 30.09.2011, demanding differential duty of Rs. 9,33,25,582, on imported Micropore, Transpore and Tegaderm, cleared during the period from October 2006 to February 2010. It was alleged that 'Hypoallergenic Surgical Adhesive Tapes' (under the brand name micropore, Transpore and Tegaderm), sold as general purpose medical adhesive tapes, are not 'ostomy appliances' for managing the four types of ostomy; in terms of the exemption Notification concessional rate of 5% BCD and Nil rate of CVD are available only for 'Skin barrier micropore surgical tapes' used as an Ostomy product (appliance) for managing Colostomy, Ileostomy, Ureterostomy, Heal Conduit Urostomy Stoma cases. Learned Commissioner passed the impugned Order-in-Original, 10/2012 dated 14.12.20 12, confirming duty of Rs. 9,33,25,582 on the appellants along with equal penalty under Section 114A of Customs Act, 1962; imposing penalties of Rs. 5....
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.... is settled by the tribunal by the decision in the case of Sutures India Pvt ltd 2019-VIL-221-CHE-CU; Tribunal examined the issue whether "Micropore surgical tape", classifiable under CTH 3005 90 60,are entitled to exemption Sl. 363(A) of Notification No. 21/2002 dated 01.03.2002; Tribunal held that the Notification apart from covering specific Ostomy products also covers the general purpose products; therefore, the impugned order is liable to be set aside. 4. Learned senior counsel further submits that surgical tapes imported by the appellants are an appliance used in managing ostomy cases and hence the exemption has been rightly claimed; Sl. No. 363(A) of Notification No.21/2002-Cus dated 1.3.2002 as amended from time to time, exempted goods specified in List 37 therein from so much of the duty of customs leviable thereon under the First Schedule to the Customs Tariff Act as is in excess of the amount calculated at the rate specified in the corresponding entry in column (4) of the Table; correspondingly, Sl.No.61 of Notification No.6/2006-CE exempted goods covered under SI.No.363 of Notification No.21/2002-Cus and mentioned in List 37 of the Customs Notification from the whole o....
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....w frame and act as an additional support to the whole pouching system; the efficacy of the pouching system, both in collecting the body waste as well as in protecting the peristomal skin by preventing leakages depends heavily on its secure adherence to the body of the ostomate; thus, the impugned imported tapes are actually used as an appliance for ostomy management and care; the appellants have produced the following documents evidencing use of imported goods for the purposes of ostomy (i). Copies of the letters issued by the hospitals and letter from Ostomy Association of India certifying the use of Micropore tapes for managing ostomy cases. (ii). Illustrative copies of purchase orders placed by various hospitals for purchase of Micropore tapes, the dealers' invoice evidencing sale of Micropore tapes and the certificates issued by the Max Super Specialty Hospital, New Delhi and HCG Cancer Centre, Ahmedabad certifying the use of Micropore tapes in ostomy care. (iii). Certificates dated 15.9.1992 issued by the Directorate General of Health Services to the effect that Transpore and also Tegaderm is a 'Skin Barriers Micropore Surgical Tape and are Lifesaving items cover....
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.... imported by the Appellant is not necessary in ostomy procedure. (i). Special Court for Economic Offences held, vide order dated 11.02.2019, that based on the literature and patents downloaded from the website, it cannot be held that the imported surgical tape is not usable in ostomy procedure; (ii). Shri K.K Ghosh, SIO, DRI admitted during Cross- Examination that the relied upon document does not state that the tape is not used for Ostomy purpose. 9. He submits that the use of the impugned goods for ostomy is undisputed and the impugned goods are therefore entitled to exemption. 'Skin barrier' and 'micropore surgical tapes' are two distinct products and there is no product corresponding to the description 'Skin barrier micropore surgical tapes' as averred in the impugned order; certain products in List 37 have not been separated by appropriate commas; list mentions bag closing clamps karaya seals paste or powder; a plain reading of the sentence would indicate that it is one product, whereas the actual usage as described above, would show that the bag closing clamps have an entirely different function and the karaya seal' has its own distinct functi....
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....hes cut to shape and their adhesive wafers or faceplates'; thus, even after amendment in 2007, the Tariff does not describe the product as 'skin barrier micropores surgical tapes' but as adhesive wafers of 'pouches'; therefore it is submitted that if the expression 'skin barriers micropore surgical tapes' in S1.No.22 of List 37 is taken to denote a single product, read with the description in the Tariff, it can only apply to the 'surgical tapes' as imported by the Appellants; he places reliance on the decision of the Tribunal in the case of Equipment Sales Corporation reported in 1989 (39) 421 wherein the benefit of erstwhile Notification No. 208/81-Cus, dated 22.09.1981 was extended to Micropore Surgical Tapes. 10. Learned senior Counsel submits that alternatively, the imported goods are entitled to exemption under Sl.No. 363(B) of the Notification. It is submitted that Sl.No.363 in the Notification exempts (i) Medical Equipment and other goods and (B) Accessories of medical equipment mentioned in (A); the tapes imported by the Appellants are used as an accessory to the pouch inasmuch as it is used to secure the pouch and other goods securely to th....
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....h, Joint Commissioner, Authorised Representative, appearing for the department reiterated the findings of OIO and submitted written submissions. He submitted inter alia that the appellant claimed exemption Notification 21/2002-Cus; Sl. No 363 A (List 37, Sl. No 22) under the category of Ostomy Products; appellants sought clearance of the products under the category of 'micropore surgical tapes' claiming that the items have microporous properties and are used in Ostomy procedures though they are being commonly used for other purposes also like fixing IV Cannulas, Bandage fixation and to hold tubes and other general purpose applications; the stated application in Ostomy cases is for giving Additional support/for affixing the Ostomy Bags or pouches; the claim is based on the premise that the said entry was also available under the earlier Customs Notification 208/1981-Cus under which also these products had been cleared as lifesaving equipment based on the DGHS certification as was required under the conditions of the notification. 13. He submits that the claim under the present entry is to be read as for "Skin barriers micropore surgical tapes "and not only as 'micropore tapes' as i....
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....if they are used in relation to ostomy procedure and that the department has not been able to show any product which fits into the category of surgical tapes meant for Ostomy only. He submits that the said decisions have been taken by the bench without taking note of the fact that the item eligible for the benefit is a combination product of Skin Barrier Micropore Surgical Tape which combines the dual properties of preventing the seepage of the ostomy discharge onto the surrounding skin thus preventing harm to the skin as well as having the microporous breathing characteristics; the bench has not been made aware of the existence of such products and hence the bench has arrived at the conclusion that such products are not available. 13.3. He submits that however, in the impugned order the Commissioner and the investigating authority have shown that there are products which fit into the category as envisaged in the entry; such a product, HOL-3722 from MEDEX SUPPLY (Para 5.1) and the product Literature of the said product is placed as RUD; the said product is described as "Cut to fit Flex wear Flat Skin barrier, Porous paper tape 1-3/4"; also products known as " Coloplast'' one piece....
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....re; products like Karaya paste, powder are also products which have these water absorbent properties and are used specially for Ostomy purposes; thus the conclusion by the bench that some of the products in the entry at Sl. No 22 of the Notification are General purpose products is factually incorrect; the whole entry is to be seen as genre of products from the perspective of being Ostomy Products and special skin care products and not products which are being used incidentally to just support/affix the ostomy pouches or tubing( as discussed in Paras 8.2.4; 8.2.5 and 8.2.6 of the OIO). 14. He submits that 3M Brochures themselves describe as follows. (i). Micropore Surgical Tape to be a non-woven rayon backed medical adhesive tape; this "paper tape" is latex free, hypoallergenic and gentle to the skin; thus, Micropore is an all-purpose tape for general use; (ii). 3M Transpore Surgical Tape to be a transparent, perforated, medical adhesive tape; the plastic tape is latex free and hypoallergenic; thus Transpore is an all-purpose tape with strong adhesion, for general use. (iii). Tegaderm is a waterproof, absorbent dressing with the following applications. -Post surgical dre....
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....ted 01/03/2002 as amended from time to time. The contention of the appellants is that their products are rightfully eligible for the exemption contained in the notification under the description "Skin Barriers Micropore Surgical Tapes"; otherwise also they are covered under Ostomy Products (appliances) for managing Colostomy, Illcostomy, Ureterostomy, Illeal Conduit Urostomy Stoma cases such as bags, belts, adhesives seals or discs or rolls adhesive remover; alternatively they claimed that they are eligible for exemption as per Sl.No. 365 which provides exemption to lifesaving equipment subject to the condition that the importer at the time of import produces the certificate to the effect that the imported goods are a lifesaving medical equipment; there is no product which suits the description "Skin Barriers Micropore Surgical Tapes" and that there should have been a comma after skin barriers. On per contra the Department contends that there exists a product which suits the description "Skin Barriers Micropore Surgical Tapes" and the notification should not be read as per convenience. 18. For a proper appreciation of the issue in question, we find it is useful to have a look at t....
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....ted by them are 'micropore surgical tape'. It is averred that the surgical tapes imported by them can be used in ostomy management. It is also the case of the noticee that it is enough if the goods are capable of being used as Ostomy Products/Appliances to claim the benefit of notification and that there is no condition that the imported goods are to be used as ostomy appliances only. 28. DRI, on the other hand, has shown that there is a product which is called "Skin Barriers Micropore Surgical Tapes" as shown in RUD No.12 which refers to Medex Supply product "HOL-3723 Cut-to-fit Flex wear Flat Skin Barrier, Porous Paper Tape, 2-1/4", manufactured by M/s. Hollister. It is also seen that M/s. Coloplast also make another similar product, the details of which are given in RUD 13 "Brand/Description: "Closed Cut-to-fit - Non Convex, Transparent 5/8-2 3/8" (15- 60MM) w/Curagard Barrier 8 long 600 ml latex free. Flexible Skin Barrier and tear-proof microporous tape for double security w/filter for odor control, soft backing for comfort, order proof film". Further, it is observed from various patents detailed in the SCH that medical requirement of protecting the peristomal region from r....
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....and cannot act as skin barriers. We find that there is visible and perceptible difference between the items as shown below. (i). Items imported by the appellants are as follows. (ii). the items demonstrated by AR are as follows 21. We find that the department has established that a product named and known as "Skin Barriers Micropore Surgical Tapes" exists. We find that evidence of the same has been supplied as RUD to the appellants. Under such circumstances, we find that the appellants contention that no product known as "Skin Barriers Micropore Surgical Tapes" exists and there should have been a comma (,) in between doesn't hold water. When such products are sold and used as such, it cannot be inferred that the notification was wrongly worded and therefore, it is to be interpreted to mean Skin Barriers, Micropore Surgical Tapes is not acceptable. 22. We find that the impugned order has discussed the issue. Learned Commissioner observes that 29. I find that even if there were to be a comma missing in the description "Skin Barriers Micropore Surgical Tapes", it is not open to me to supply the same. In the case of The Commissioner of Sales Tax, Uttar Pradesh Vs. M/s. Parson Too....
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....he duty of the Court to give without engrafting, adding or implying anything which is not congenial to or consistent with such express intent of the law giver. More so, it a Statute is a taxing Statute. It must be assumed that the Rule making authorities do no commit mistake or make any omission. (Emphasis supplied). Therefore, the contention of the Respondent to supply the word 'Dibrugarh' in the Notification of 1981 is not permissible." In the present case, as already held, there is no omission in the notification as the products corresponding to generic description "Skin Barriers Micropore Surgical Tapes" exist. Even if it were to be so, such omission could not have been supplied in accordance with the law settled as above". 23. We find that in view of the above, there is no ambiguity in the notification and there is no need to interpret the notification by supplying what is assumed to be missing in the notification. We find that Hon'ble Apex Court has held in Dilip Kumar & Company 2018 (361) ELT 577 (SC) that 22. At the outset, we must clarify the position of 'plain meaning rule or clear and unambiguous rule' with respect of tax law. 'The plain meaning rule' suggests tha....
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....the creepy characters they've dreamed up on their own.- Dana Coffield e: computing : information appliance A growing number of companies are coming up with ways [in 2000] to turn ordinary phones into Internet appliances.- Sharon Cleary 3.obsolete: compliance Cambridge dictionary defines appliances as follows (https://dictionary.cambridge.org/dictionary/english/appliance) a device, machine, or piece of equipment, especially an electrical one that is used in the house, such as a cooker or washing machine: Going by the above definition or any other definition one can find that the meaning attached with an appliance is closer to equipment. Therefore, we are not inclined to accept the contention of the appellants. The impugned goods at best can be held to be disposables used in surgery or other medical procedures. 25. Learned counsel for the appellants also argued that the Notification also provided, at SI. No. Sl. No.363 A, exemption to Life Saving Equipment subject to production of a certificate from DGHS to the effect that the imported goods are lifesaving medical equipment; he submitted that the appellants have produced such certificates and have a right to claim the same....
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....gical Tape' exist and that the impugned goods do not match the description given in the notification so as to be eligible for the exemption. While we are in agreement with the coordinate bench that there is no specific mention in the Notification that Skin Barrier Micropore Surgical Tapes have to be exclusively used for ostomy procedures and it is enough if they are capable of being used, we find that to be eligible for exemption the impugned goods need to match the description as given in the notification and only then the question of their actual use or capability of being used would come into play. We also find in the instant case that the department could produce evidence to show that products known as "Skin Barriers Micropore Surgical Tapes" exist. We find in our considered opinion that the real issue is whether the impugned goods can be categorised as "Skin Barriers Micropore Surgical Tapes" to be eligible to the exemption. As per our discussion above, the distinction between the impugned products and the items eligible for exemption has been clearly established. It was also established that products which can be described as "Skin Barriers Micropore Surgical Tapes" exist. Th....