Light Metal Extrusion Vs. Collector of Customs - Court Judgment

Excerpt:
1. this appeal is directed against the order-in-appeal no. 115/90-bch passed by the collector of customs (appeals), bombay.2. brief facts of the case are that appellants imported goods namely hydraulic press for the purpose of manufacture of seamless tubes under bill of entry no. 8590, dated 21-1-1987. the goods were assessed under heading 9801.03 of the customs tariff act under project import at the rate of 30% plus 35% c.v. nil in terms of notification no. 132/85.subsequently the appellants filed claim for refund of duty in accordance with the provisions of notification no. 40/78 which grants exemption to certain specified goods falling within chapter 84 of the first schedule to the c.t.a. 1975 from duty in excess of 35% ad valorem. the appellant's claim for the benefit of the notification was rejected both by the assistant collector and the collector (appeals), bombay for the reasons that goods had been classified under chapter 98 while notification was applicable only to goods covered under chapter 3. the ld. counsel for the appellants submits that the appellants right to claim the benefit cannot be taken away by reason of the fact that their goods were assessed under project import and in this context he cites the decision reported in the case of abrol watches (p) ltd. v.c.c., bombay -1997 (92) e.l.t. 311 (sc). he further argues that once it is decided that the importers can claim the benefit of notification no.40/78, they are automatically entitled to the benefit thereof, since they are covered by si. no. 23 of this notification.4. arguing on behalf of the revenue the ld. d.r. while reiterating the finding of the authorities below submits that in any event the question of extending the benefit of notification no. 40/78 cannot be decided by the tribunal since the basic fact has to be examined by the authorities below as to whether the goods are covered by the description contained in si. no. 23 of notification no. 40/78 which covers 'hydraulic extrusion press for manufacture of seamless tubes or profiles of steel and non ferrous metals' and the authorities below have also not examined as to whether the goods have been classified under chapter 84 of the first schedule to the c.t.a., 1975. he further submits that this question has to be gone into by the assistant collector of customs to whom the matter is to be remanded for consideration on this aspect.4. on careful consideration of the submissions made by both sides and having regard to the judgment of the hon'ble apex court in the case of abrol watches (p) ltd. (supra) which squarely applies to the present case, we hold that the appellants are entitled to claim the benefit of notification no. 40/78. however, in the absence of any finding as to the applicability of this notification to the goods imported by the appellants, we set aside the impugned order and remand the matter for fresh adjudication to the assistant commissioner of customs for considering the availability of the benefit of this notification to the goods imported by the appellants and passing fresh orders in accordance with law after affording reasonable opportunity to the appellants of being heard. since the matter is being remanded we will appreciate it, if fresh orders after remand are passed within a period of three months from the date of communication of this order.

Judgment:
1. This Appeal is directed against the Order-in-Appeal No. 115/90-BCH passed by the Collector of Customs (Appeals), Bombay.

2. Brief facts of the case are that Appellants imported goods namely Hydraulic Press for the purpose of manufacture of seamless tubes under Bill of Entry No. 8590, dated 21-1-1987. The goods were assessed under heading 9801.03 of the Customs Tariff Act under project import at the rate of 30% plus 35% C.V. Nil in terms of Notification No. 132/85.

Subsequently the Appellants filed claim for refund of duty in accordance with the provisions of Notification No. 40/78 which grants exemption to certain specified goods falling within Chapter 84 of the First Schedule to the C.T.A. 1975 from duty in excess of 35% ad valorem. The appellant's claim for the benefit of the Notification was rejected both by the Assistant Collector and the Collector (Appeals), Bombay for the reasons that goods had been classified under Chapter 98 while Notification was applicable only to goods covered under Chapter 3. The ld. Counsel for the Appellants submits that the appellants right to claim the benefit cannot be taken away by reason of the fact that their goods were assessed under project import and in this context he cites the decision reported in the case of Abrol Watches (P) Ltd. v.C.C., Bombay -1997 (92) E.L.T. 311 (SC). He further argues that once it is decided that the importers can claim the benefit of Notification No.40/78, they are automatically entitled to the benefit thereof, since they are covered by SI. No. 23 of this Notification.

4. Arguing on behalf of the Revenue the ld. D.R. while reiterating the finding of the authorities below submits that in any event the question of extending the benefit of Notification No. 40/78 cannot be decided by the Tribunal since the basic fact has to be examined by the authorities below as to whether the goods are covered by the description contained in SI. No. 23 of Notification No. 40/78 which covers 'Hydraulic extrusion press for manufacture of seamless tubes or profiles of steel and Non Ferrous Metals' and the authorities below have also not examined as to whether the goods have been classified under Chapter 84 of the First Schedule to the C.T.A., 1975. He further submits that this question has to be gone into by the Assistant Collector of Customs to whom the matter is to be remanded for consideration on this aspect.

4. On careful consideration of the submissions made by both sides and having regard to the judgment of the Hon'ble Apex Court in the case of Abrol Watches (P) Ltd. (supra) which squarely applies to the present case, we hold that the appellants are entitled to claim the benefit of Notification No. 40/78. However, in the absence of any finding as to the applicability of this Notification to the goods imported by the appellants, we set aside the impugned order and remand the matter for fresh adjudication to the Assistant Commissioner of Customs for considering the availability of the benefit of this notification to the goods imported by the appellants and passing fresh orders in accordance with law after affording reasonable opportunity to the appellants of being heard. Since the matter is being remanded we will appreciate it, if fresh orders after remand are passed within a period of three months from the date of communication of this order.