JUPITER RADIOS Vs. COLLECTOR OF CUSTOMS

JUDGEMENT

(1.) THIS is an appeal against the order dated 11 -4 -1985 passed by the Additional Collector of Customs, Bombay. The appellants are manufacturers of T.V. sets. They imported one Automatic Wire Cutting and Stripping machine, model AWY -40 from Japan. In the Bill of Entry filed for the clearance of the machine it was declared as Automatic Wire Cutting and Stripping machine. The clearance of the machine was claimed under OGL vide Srl. No. 11/42 of Appendix 1B of the Import Policy, 1984 -85. The importers also claimed benefit under Notification No. 118/80 -Cusv dated 19 -6 -1980 vide Srl. No. 105 of the table annexed to the notification which exempted "Automatic Wire Cutting and Stripping machine with or without welding attachment or semi -conductors, capacitors or resistors" falling under Chapter 84 or 85 or 90 or 92 of the Customs Tariff and used in the electronic industry, from duty in excess of 20% ad valorem. On the ground that the handling manual found in the package in which the machine was shipped described it as Auto Wire Twisting machine, the appellants were served with a show cause notice requiring them to show cause as to why the goods should not be confiscated under Sections 111(d) and (m) of the Customs Act, 1962 and why benefit under exemption Notification No. 118/80 -Cus., dated 19 -6 -1980 should not be denied. The appellants denied the allegation in the show cause notice and contended that being a machine mainly designed for cutting and ( stripping of wires and twisting module being only an additional capability which could be set in idle position when cutting and stripping was only required, it was eligible for clearance under OGL as well as the benefit under exemption Notification No. 118/80 -Cus. By the impugned order the Additional Collector rejected the appellants' contention on the ground that the machine not being exclusively meant for cutting and stripping wire was not covered by OGL and it was also not eligible for concessional assessment under Notification No. 118/80 -Cus., dated 19 -6 -1980. However, in regard to the licensing aspect he took a lenient view and ordered the clearance of the machine against OGL by cautioning the importers that such leniency would not be shown in future.

(2.) ON behalf of the appellants Shri N.C. Sogani, learned Consultant referred to the relevant catalogue issued by the manufacturer and submitted that even though the machine had been described as Automatic Wire Twister AWY -40, it was essentially meant for cutting and stripping of wires. He pointed out that the detailed specification and capacity of the machine as given in the catalogue was in respect of its cutting and stripping operations. He stated that as far as twisting mechanism was concerned, the manufacturer had stated that it could be set in idle position when cutting and stripping only was required. He contended that even though the machine was capable of performing additional function namely, twisting, it was eligible for the benefit of Notification No. 118/80 -Cus., dated 19 -6 -1980 since it was essentially an automatic wire cutting stripping machine. He contended that the additional function of twisting which the machine was capable of performing would not disqualify it from the benefit of OGL and the Notification No. 118/80 -Cus., dated 19 -6 -1980. In support of his contention he placed reliance on the judgment of the Madras High Court in the case of Titan Watches Ltd. v. Union of India, reported in 1994 (69) E.L.T. 22 (Mad.) and the Tribunal's decision in the case of Andhra Patrika, Madras, reported in 1983 (13) E.L.T. 1103. He also submitted that during the proceedings before the Additional Collector the appellant had also relied upon a letter dated 11 -1 -1985 issued by the Department of Electronics wherein it was stated that the machine in question was an automatic wire cutting and stripping machine with additional function of wire twisting.

(3.) ON behalf of the respondent Shri S.K. Tyagi, learned JDR reiterated the findings of the Collector (Appeals) in the impugned order and pleaded for the rejection of the appeal.