IVRCL INFRASTRUCTURES AND Vs. CC (SEA)

JUDGEMENT

(1.) The appellants filed Bill of Entry (for home consumption) No. 369413 dated 28.12.2001 through CHA for clearance of imported goods from Germany declared as HOT MIX PLANT BATCH TYPE WITH ELECTRONIC CONTROLS AND BAG TYRE FILTER ARRANGEMENT 160 TONS PER HOUR CAPACITY valued at DM 550,000/ -. Clearance was sought under Customs Tariff Heading 8474.80 at 'nil' rate under Notification No. 17/2001 -Cus. Dated 1.3.2001. The notification vide Serial No. 217 thereof granted full exemption from basis customs duty and additional customs duty, to goods of Chapter 84 specified in List -II, required for construction of roads. The first among the 21 items specified in List -II under the Notification was "Hot Mix plant batch type with electronic controls and bag type filter arrangements, more than 120 Tons per hour capacity." The exemption, allowed to the goods specified in the list, was subject to Condition No. 38 stipulated in the Notification. This condition reads :

(2.) Heard both sides. Learned counsel for the appellants gave a brief account of the relevant facts and stated two main issue to be decided on. The appellant -company viz. M/s. IVRCL Infrastructures and Projects Ltd. ["IVRCL", for short] entered into a Joint Venture Agreement with M/s. Shapoorji Pallonji and Co. Ltd. ["SPCL", for short] in October 2000. The National Highways Authority of India (Ministry of Road Transport and Highways, Govt. of India) in June 2001 awarded to this Joint Venture a contract for construction of roads (including upgrading of existing roads, construction of service roads and other auxiliary works) in the Srikakulam -Palasa segment of NH -5 in Andhra Pradesh) which was referred to as "Contract Package AP -2" in the relevant agreement, which was executed on behalf of NHAI by its General Manager (East -I) and on behalf of the SPCL -IVRCL Joint Venture by the Authorised Representatives of the two companies. A Hot Mix Plant (Batch Type) of capacity above 140 Tons/hour was required for execution of the road construction work. Therefore, IVRCL placed a purchase order with M/s. Lintec GmbH and Co. KG '"Lintec", for short] for Hot Mix Plant (Batch Type) of capacity 160 Tons/hour and the goods supplied by the German Company were cleared at Chennai Customs by IVRCL under the subject Bill of Entry. The first issue stated by the counsel was whether the imported goods conformed to the description of item No. 1 in List -11 under Notification No. 17/2001 -Cus., for the benefit of exemption in terms of Sl. No. 217 of the Table to the Notification. On this issue, he submitted that the goods were to be treated as Hot Mix Plant in unassembled condition. The purchase order placed on the German supplier was for Hot Mix Plant only. The plant was not capable of being supplied in fully assembled condition. Hence it was supplied in unassembled condition. The consignment included all components of Hot Mix Plant, except steel structure which was left out only for the sake of convenience of transportation. This, however, was not reason to hold that the complete plant covered by the purchase order was not imported by the appellant. After confirmation by the NHAI that the subject import fully met the characteristics of Hot Mix Plant required for execution of the road works, there was not justification in holding that only components of the plant were imported. Counsel was referring to a letter dated 20.1.2002 issued to the Chief Commissioner of Customs by the Chief General Manager (Technical) of NHAI. Leaned counsel argued that the relevant entry in List -11 under the Notification required to be given a liberal interpretation. The word "with" occurring in the entry ["Hot Mix plant batch type with electronic controls and bag type filter arrangements, more then 120 T/hour capacity"] was not to be taken in a restrictive sense so as to deny the benefit of the Notification to the goods imported, particularly in view of NHAI's recommendation. IN this context, reliance was placed on the Tribunal's decision in Kankar Synthetic Fibres Ltd. Vs. CCE, Mumbai [2003 (59) RLT 935].

(3.) On the second issue whether IVRCL was an eligible importer in terms of Condition No. 38 of the Notification, counsel submitted that the view taken by the Commissioner was not correct inasmuch as a Joint Venture was not a legal person and any of the two partners (viz. IVRCL and SPCL) of the Joint Venture was competent to import requisite machinery for the road project under the Joint Venture Agreement as well as under the contract between the Joint Venture and NHAI. Ld. counsel relied on the Supreme Court's judgment in New Horizons Ltd. and Another Vs. Union of India and others [1995 1 SCC 478]to explain the concept of Joint Venture. He submitted that IVRCL was entitled to import the plant for and on behalf of the Joint Venture and therefore the contra view taken by the Commissioner required to be rejected.