VINODHAGAN MEMORIAL HOSPITAL Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) THE appellants had imported a medical equipment valued at Rs. 6,93,184/ - and cleared the same without payment of duty under Notification No. 64/88 -Cus. dated 1.3.1988 vide Bill of Entry No. 12770 dated 2.4.1992. The clearance was obtained on the strength of a Customs Duty Exemption Certificate [CDEC for short] of the Director -General of Health Services [DGHS for short].

(2.) THE above Notification had stipulated that hospitals certified by DGHS should provide medical, surgical or diagnostic treatment -

(3.) LATER , on from the results of enquiries, it appeared to the department that the appellant's institution was only a diagnostic centre/polyclinic and not a hospital; that they had not provided free treatment to 40% of the outdoor patients and also had not provided reservation of 10% of beds for treatment of poor inpatients. The appellants were thus found to have violated the conditions of the above Notification. Therefore, a show -cause notice dated 7.9.1992 was issued to them for (a) recovering duty on the goods under the proviso to Section 28(1) of the Customs Act by denying the benefit of the above Notification, (b) confiscating the goods under Section 111(o) of the Act and (c) imposing penalty under Section 112(a) of the Act. These proposals were contested. In adjudication of the dispute, the original authority confirmed demand of duty of Rs. 2,77,284/ - against the importer, held the goods liable for confiscation under Section 111(o) of the Act but allowed its redemption against payment of a fine of Rs. 2,77,284/ - and imposed a penalty of Rs. 10,000/ - on the party under Section 112(a) of the Act. The appeal filed with the Commissioner (Appeals) against the decision of the original authority was rejected. Hence the present appeal.