Customs, Excise and Gold Tribunal - Mumbai
Jaslok Hospital & Research Centre vs Commissioner Of Customs on 12 May, 2003
ORDER S.S. Sekhon, Member (T)
1. The appellants have a hospital in Bombay. They had imported and cleared certain hospital equipments availing the benefit of Notification No. 64/88-CUS dated 01.03.1988. Proceedings were initiated by the department by issuance of a show cause notice dated 22.3.2002 proposing to deny the benefit of notification availed, on the ground that the appellants had not fulfilled the conditions mentioned in paragraph 2(a) and 2(b) of the table to the said notification. The Commissioner passed the impugned order denying benefit of notification 64/88 without appreciating the plea and the requests made by the appellants to furnish them copy of Rosha Committee report and copies of documents submitted by the appellants before Rosha Committee for the period 1994-95 and 1995-96 and the request for summoning of Shri G. Anantharaman, Member of the said committee. The commissioner confiscated goods for contravening of Section 111(o) of the Customs Act, 1962, give an option to redeem the same on payment of fine of Rs. 25,000/- and held that the benefit of notification 65/88-CUS was available to the appellants and confirmed differential duty.
2. The appellants contended that the appellants being a charitable organization, were not required to fulfill the condition of serial No. 2 to Table to Notification No. 64/87-CUS since condition given at serial No. 2 would apply to hospitals under that serial no. and similar conditions attached at serial Nos. 3 and 4 of the notification would apply to hospitals under those serial nos. Their hospital falls under serial No. 1 and not such conditions of minimum percentage of treatment of outdoor patients, indoor patients etc. are prescribed at hospital at serial No. 1. They also submitted that the conditions under which the CDEC certificates have been treated as invalid and withdrawn would apply only to categories of hospitals covered under serial No. 2 only and since they do not come under serial No. 2 Table to the Notification it does not appeal to them and they relied on the case of St. Stephens Hospital v. Commissioner of Customs, New Delhi - 2000 (121) ELT 91 (T). They further submitted that being a charitable hospital medical record were maintained by them were scrutinized by the Joint Director of Health Services, Mumbai and thereafter, certificates were issued certifying that they have satisfied conditions of Notification No. 64/88-CUS since these original records which were verified are now not available and records of the outdoor patient. OPD registers for the period 1994-95 were furnished to Shri G. Anantharaman, Member of Rosha Committee on 27.8.1998 which was not returned to them, they are not in a position to produce the said registers/records to prove that 40% of deserving patient were given treatment, however, they are having material to prove that they are giving fee treatment to out patients and 10% beds are reserved for such patients and the material would conclusively prove that more than 40% of the patients were treated as free of the charge. They submitted that findings of the Commissioner on this account are factually not correct and affidavits filed by them were not considered. There is no contrary evidence produced by the department in the present case to show that the appellants have not complied with the condition of the said notification. The statement recorded from the employees will not be sufficient position. Since the notification has been rescinded after 1.3.1994 they are not required to comply with the condition of that notification. After that date in any case the condition of the said notification are not required to be meet post import condition. Therefore Section 111(o) is not attracted and reliance on Jagdish Cancer & Centre - 2001 (132) ELT 257 was not applicable. They submitted that the reliance on the decision of Karnataka High Court in chaparral Heavy Services Ltd. - 2001 (130) ELT 34 (Kar.) was not correct and penalty imposed can not be upheld or is called for.
3. After considering these submissions, the reiteration of the point in the Commissioners order reliance on paragraph 13 of the decision in the case of Mediwell Hospital & Health Care Pvt. Ltd. - 1997 (89) ELT 425 (S.C.) placed by the DR, has specifically the following findings therein and the direction of the Supreme Court as which are follows:-
"It is needless to reiterate that all the persons including the appellants who had the benefit of importing the hospital equipment with exemption of customs duty under the notification should notify in the local newspaper every month the total number of patients they have treated and the 40% of them are the indigent persons below stipulated income of Rs. 500/- per month with full particulars and address thereof which would ensure that the application to treat 40% of the patients free of cost would continuously be fulfilled. In the event of default, there should be coercive official action to perform their obligation undertaken by all such persons. This condition becomes a part of the exemption order application and strictly be enforced by all concerned including the Police personnels when complaints of non-compliance were made by the indigent persons, on denial of such treatment in the concerned hospital or diagnostic centres, as the case may be."
It is not open for us and the Commissioner to have confirmed non-compliance of regulation without bringing on records the efforts made to enforce the said condition. Therefore, we can not upheld the confiscation of the medical equipments as ordered by the Commissioner and the duty demand thereafter arrived at alongwith penalty since it was imperative on his part to have ensured strictly compliance to the condition of the notification on receipt of the complaint of non compliance thereof. We, therefore, set aside this order impugned before us and remit the matter back to the Commissioner to ensure that the Supreme Court direction in paragraph 13 and 14 of the Mediwell Hospital & Health Care Pvt. Ltd. are enforced and only a failure thereof resort to duty and confiscation may be arrived at after supplying the copies of the documents as to be relied upon by him along with the right of the importers to cross examine the witness if any, of their option. With these observations the appeal is allowed as remand to the Commissioner. (Pronounced in Court)