VISHAL ELECTRONICS PVT LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) THIS is an appeal preferred by the original petitioners to challenge legality of judgment dated july 12, 1989 delivered by learned Single Judge in Writ Petition No. 2876 of 1982 filed by the appellants. By the impugned judgment, the petition was dismissed and the claim of the appellants for advantage of notification dated August 8, 1977 was turned down. The facts which gave rise to the litigation are as follows :

(2.) THE appellants are engaged in the manufacture of closed circuit television cameras and for the purpose of manufacture, the appellants are required to import various components including lenses which are optical appliances of a very sophisticated nature. The lenses are liable to payment of excise duty in accordance with Tariff Item No. 90. 02 of the Customs Tariff Act, 1975. The relevant entry reads as under : "90. 02 Lenses, prices, mirrors and other Rate of duty apoptical elements of nay material applicable to the instrumented being parts of or fittings ments or apparatus to for instruments or apparatus, other which they are parts or than such elements of glass in opti- fittings. " cal work. The close circuit Television cameras of which the lenses are part, are liable to payment of duty under Tariff Item No. 85. 15 (1) of the Customs Tariff. The tariff entry reads as under :-

(3.) ON January 28, 1981, the appellants secured invoices for purchase of 11 pieces of lenses to be imported under open general licence. The appellants filed the bill of entry for home consumption claiming exemption under notification for payment of duty at 60% ad valorem. The Assistant collector by order dated March 17, 1981 rejected the claim seeking exemption on the ground that the goods were correctly assessed under Tariff Item No. 90. 02. The appellants thereupon carried appeal before the Collector of Customs (Appeal) and the appeal was allowed by order dated June 5, 1981. The appellate authority held that the lenses imported by the appellants were for use in T. V. cameras only and the advantage of the exemption notification is available. On September 14, 1981, the Government of India, Ministry of Finance, served show cause notice in exercise of powers under Section 131 (3) of the Customs Act upon the appellants to explain why the order of the appellate authority should not be set aside. The show cause notice, inter alia, recites that the Government is tentatively of the view that the benefit of the notification to the goods classifiable under Heading 90. 02 of the Central Tariff was not available. The appellants filed reply to the show cause notice and Joint Secretary of the Government of India by order dated July 7, 1982 made the notice absolute and set aside the order of the appellate authority. The Government held that the benefit of partial exemption in terms of notification is available to goods which are specified in table appended to the notification and, therefore, the benefit can be extended only to goods falling under Tariff Entry 85. 15 (1) and not to goods under tariff Entry 90. 02. The decision recorded by the petition ended in dismissal by the impugned judgment.