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Cus - Whether 'recognition' is equivalent to 'registration’ - Revenue to cause enquiry from Dept. of Science: CESTAT

By TIOL News Service

MUMBAI, SEPT 14, 2017: IN respect of goods imported and which were meant for in-house research and development, the importer was granted exemption from payment of Basic customs duty in terms of serial No. 248 of Notification No. 21/2002-Cus dated 1.3.2002 as amended.

The Customs notification is extracted below -

 

 

248

84,85 or 90

(1) The following goods for use in pharmaceutical and biotechnology sector, imported for research and development purposes, by an importer registered with the Department of Scientific and Industrial Research, in the Ministry of Science and Technology of the Government of India, namely:-

      

However, exemption from additional duty of customs was not granted in terms of Notification No.10/1997-CE dated 1.3.1997.

The Central Excise notification entry insofar as that is applicable to the present case is -

S.No.

Name of the Institutions

Description of the goods

Conditions

(1)

(2)

(3)

(4)

"2.

Research institution, other than a hospital

(a) Scientific and technical instruments, apparatus, equipment (including computers);

(1) The institution

(i) is registered with the Government of India in the Department of Scientific and Industrial Research;

The reason for denial of the CE exemption is that the "institution is not registered with the Government of India".

The Appellant submits that it is recognized by the Department of Science and Industrial Research as an in-house research institution and such recognition is equivalent to registration as envisaged by Notification No. 10/1997-CE.

The only controversy in the appeal is to the effect whether "recognition shall amount to registration".

The AR submitted that "recognition" does not amount to "registration" when the decision of Tribunal in the case of Guard Electronics Systems Pvt. Ltd. vs. CCE, Delhi-II - Order no. A/633/2004-NB(C) dated 02.09.2004 is read.

The Bench observed -

"6. The legislature uses specific term in a notification to grant benefit at public cost. The grant of notification depends on such term and the object thereof. That is to be looked into it for the purpose of grant of benefit thereof. Therefore in all fairness, Revenue is directed to cause enquiry from the Department of Science and Industrial Research, Ministry of Science and Technology, to ascertain what does ‘registration" mean in terms of the notification. On the basis of the outcome of the enquiry confronting the result thereof, learned adjudicating authority shall pass appropriate order granting reasonable opportunity of hearing to the appellant. We may mention at this stage that on similar such terminology of "registration" used in Notification No. 21/2002-Cus. dated 1.3.2002, basic customs duty exemption has been granted to the appellant. We do not understand why learned adjudicating authority granted that benefit and denied benefit of exemption from additional duty of customs under Notification No. 10/1997-CE dated 1.3.1997."

The matter is remanded to the adjudicating authority.

(See 2017-TIOL-3334-CESTAT-MUM)


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