2001 (8) TMI 113 - SUPREME COURT

Whether or not a new ground or case for confiscation has been carved out as found by the CEGAT?

Looking to the total picture of the free treatment provided by the Centre, it is to be noticed that shortfall in providing free treatment is marginal?

Held that:- According to the CEGAT, Para 3 of the notice relates to confiscation of goods under Section 111(o) of the Customs Act on the ground of non-submission of certificate under Condition 4(iii) of the Notification. Therefore, confiscation could be ordered only on the ground of non-submission of certificate and on no other ground. It is further pointed out by the CEGAT that Para 5 of the notice relates to payment of customs duty only, on the ground of violation of conditions relating to providing free treatment as well as on account of non-submission of certificate under Condition No. 4(iii) of the Notification. In connection with the above argument, it would be relevant to refer to para 7 of notice, a perusal of which would indicate that confiscation of the subject goods was intended for violation of various conditions of Notification No. 64/88, dated 1-3-1988. We find, that various conditions which were violated are indicated earlier in paragraphs 3 and 5 of the notice. Para 3 contained only one condition not various conditions. We, therefore, feel that reading the notice parawise and confining it watertight within each paragraph, would not be a correct way of construing a notice. It is to be read as a whole to find out as to whether the person concerned is made aware of the various grounds on the basis of which action is proposed to be taken as well as nature of the action. The view taken by the CEGAT on the point indicated above is erroneous and cannot be upheld.

In any case, over and above all, it has not been in dispute that the Centre did not have inpatient facility. According to the condition of notification 10% of total beds in hospital are to be kept reserved for patients of the families having an income of less than ₹ 500/- per month. The case of the Centre, in this connection, is that they had an arrangement with another hospital in the proximity which is a sister concern of the Centre, with whom the Centre had entered into an agreement for reserving 10 per cent beds. Payments in respect of these inpatients is to be made by the Centre. We feel that the 10 per cent of the total number of beds are supposed to be reserved for patients of such families in the hospital where the equipment is installed. The purpose of the Notification for grant of exemption from payment of customs duty would not be served by making payment of expenditure incurred on some inpatients in some other hospital as alleged. It has also not been shown that alleged arrangements had the approval of the concerned authority or that it was brought to their notice at all.