Customs, Excise and Gold Tribunal - Delhi
Electro Mexicals vs Collector Of Customs on 21 September, 1998
Equivalent citations: 1999(108)ELT128(TRI-DEL)
ORDER A.C.C. Unni, Member (J)
1. This appeal is directed against Order-in-Appeal dated 14-1-1992 passed by Collector (Appeals), Bangalore by which Order-in-Original dated 23-12-1991 passed by Assistant Collector denying the present appellants the benefit of Notification No. 208/81-Cus. was confirmed.
2. Under Bill of Entry No. 019271 dated 18-9-1991 appellants imported a consignment of defibrillator capacitors (life saving equipment). The same was assessed under Heading 8432.09 read with Notification No. 91/89-Cus. Appellants contested the assessment arguing that the item imported, i.e. capacitor was a component of DC Defibrillator (life saving equipment) and therefore eligible for the benefit of Notification No. 208/81. They claimed that the imported Defibrillator capacitors were eligible under the said notifications in terms of SI. No. 6 as "Life Saving Equipments".
3. In adjudication Assistant Collector rejected the claim holding that these items were specifically excluded from the purview of the said notification.
4. In the appeal proceedings before Collector (Appeals) appellants contended that the intention of the Central Government in granting exemption to Life-saving Equipments would be defeated if exemption was granted only to the main equipment and not to the essential parts. Reliance was placed on Tribunal decision in 1984 (18) E.L.T. 135 in support of their argument that a Notification should be interpreted in a manner which would further the cause of justice and not to hamper it. Further, if the intention was to exclude parts for the benefit of the exemption, then it would have been listed as an entity immediately after (d) under Sl. No. 6 under the heading "Life Saving Equipments" in the Schedule to the Notification.
5. Collector (Appeals) held that Notification No. 208/81 exempted DC Defibrillators for internal and external use and Pacemakers and their accessories including patient cable, internal Defibrillator paddles, 45 mm and 55 mm size as well as components of DC Defibrillators listed at (i) to (iv). If the intention was to give the benefit of the exemption to these components listed at (i) to (iv) then they would have been mentioned in the main entry itself. Collector (Appeals) observed:
"The entry itself gives exemption to certain accessories including patient cable, internal defibrillator paddles of 45 mm and 55 mm size. It makes certain exclusions which are specific. Similarly, if the exclusion under this entry is meant to cover only the items listed at (a) to (d), then it would have been mentioned as (a), (b), (c) and (d). But on the other hand, the word "and" is a conjunction after the entry against (d) and therefore the components listed under entry against (d) and therefore the components listed under Sl. No. (i) to (iv) are also covered under the exclusion clause. It is therefore difficult to accept the plea of the appellants that the entry at Sl. No. (i) to (iv) will have to be read in conjunction with the main entry and restrict the exclusion only to the items listed against (a) and (d). I, therefore, do not find any justification in this appeal...".
6. Ld. Ashutosh Upadhyay, ld. Advocate stated that under the relevant portion of Schedule to Notification No. 208/81 the exclusion clause referred to only four items mentioned as (a) to (d) under the heading "Life Saving Equipments" against Sl. No. 6. These were (a) E.C.G. Recorder, (b) Cardioscopes, (c) Cardiac Monitors, (d) E.C.G. Monitors of any type. He submitted that Collector (Appeals) had misconstrued the scope of the exclusion clause in the Schedule to the Notification to include components of D.C. Defibrillators including discharge capacitors which was not the intention of the Notification. Discharge capacitors and the three other items shown against sub-serial Nos. (ii) to (iv) of the latter part of serial No. 6 to the Schedule were essential parts of D.C. Defibrillators without which Defibrillators cannot function at all. Therefore, if the exemption to these essential parts are denied then the very purpose of the exemption granted under the Notification for Life Saving Drugs will become meaningless. Alternatively, it was also submitted on behalf of the appellants that the rate of duty leviable on the items will be at the rate of 40% ad valorem in terms of Notification No. 165/86-Cus. as amended.
7. Appearing for the respondents Shri S.N. Ojha, ld. JDR submitted that in terms of exemption Notification No. 208/81 while giving exemption to D.C. Defibrillators internal and external use and pace makers and their accessories including patient cable; interna Defibrillators paddles 45 mm and,55 mm sizes excluded (a) ECG Recorder/ (b) Cardeos copes, (c) Cardiac Monitors, (d) ECG Monitors of any type. These items belonged to the category of accessories of D.C. Defibrillators and pace makers. It also excluded certain equipments of D.C. Defibrillators, viz, (i) Polyester/Paper discharge capacitprs, (ii) Discharge/Damp Relay, (iii) Connector, (iv) High Voltage Retractable, Flexible Wire. From the scheme of the Schedule to the Notification it was quite clear that there was no exemption available to capacitors which had been specifically mentioned as item (i) of the components of D.C. Defibrillators in the category of excluded items. The word "and" after item (d) of the excluded category go to show that componentst of Defibrillators mentioned as items (i) to (iv) would fall under the excluded category. If the intention of the Government was to restrict the exclusion only to accessories listed as (a) to (d), there would have been no need to put the word "and" after item (d). 8. We have considered the submissions. The relevant portion of-NotificationNo. 208/81-Cus. reads as follows:- . .
"The Central Government, exempts goods specified in the Schedule annexed hereto when imported into India from -, . . .
(i) XXX XXX XXX XXX
(ii) XXX X XXX XXX SCHEDULE A. Life Saving drugs or medicines (1) XXX XXX XXX XXX to (129) XXX XXX XXX XXX B. Life Saving equipments. (1) XXX XXX XXX XXX to (5) XXX XXX XXX XXX
6. D.C. Defibrillators for internal and external use-and Pace Makers and their accessories including patient cable, internal Defibrillators Paddles 45 mm and 55 mm sizes but excluding :-
(a) E.C.G. Recorder
(b) Cardioscopes.
(c) Cardiac Monitors.
(d) E.C.G. Monitors of any type.
and the following components of D.C. Defibrillators namely : - (i) Polyester/paper Discharge Capacitor.
(ii) Discharge /Damp Relay' .
(iii) Connector.
(iv) High Voltage Retractable, Flexible wire.
8. XXX XXX XXX to 37. XXX XXX XXX C. Life Saving Drugs or Medicine or equipment nor specified in headings A and B. XXX XXX XXX XXX."
9. As will be seen from Sl. No. 6 above, Defibrillators and Pace Makers have been put in the category of life saving equipments. Accessories to Defibrillators and Pace Makers including patient cable, internal Defibrillators paddles 45 mm and 55 mm sizes have been included for the exemption. However,
(a) ECG Recorder,
(b) Cardioscopes,
(c) Cardiac Monitors, and
(d) ECG Monitors of any type.
have been excluded. Item (a) to (d) above have been in other words, not included in the category of accessories to Defibrillators and Pace Makers eligible for the benefit of the Notification. It will also be noticed that there is a further exclusion of certain components of Defibrillators. These are identified as Items (i) to (iv). These are :
(i) Polyester/paper Discharge Capacitor.
(ii) Discharge/Damp Relay.
(iii) Connector, and
(iv) High Voltage Retractable Flexible wire.
It is apparent from the above that as per the scheme of the exemption Notification the two sets of items, one, covered by items (a) to (d) and another covered under items (i) to (iv) have been clearly excluded for the benefit of exemption under Notification No. 201 /81. Having regard to the aforesaid, we find that the view taken by the authorities below holding that Defibrillators capacitors imported by the appellants were excluded from the benefit of duty exemption under Notification No. 208/81-Cus. cannot be faulted.
10. Accordingly, we uphold the impugned order and reject this Appeal.
S.K. Bhatnagar, Vice President I would like to add that while it is true that a notification must not be so interpreted that its very purpose is defeated and in the present case it may be difficult for the defibrillators to function without capacitors, it is necessary to emphasis the fact that in the present case while defibrillators are covered in the 'life saving equipments' category but the coverage is only partial as certain components/parts and accessories have been deliberately excluded and in so far as the defibrillators are concerned, the polyester/paper discharge capacitors have been specifically excluded. Therefore, irrespective of the fact as to whether they are essential parts or accessories, the benefit cannot be allowed to the capacitors if they are of the type mentioned in the Exclusion Clause. No evidence has been produced before us to show that they are of any other type. In the facts and circumstances of the case, I agree that the ld. Collector is right and, therefore, the order is required to be upheld and the appeal is required to be rejected.