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2018 (6) TMI 47 - AT - CustomsImport of 'second hand diesel engine with turbocharger' - Benefit of N/N. 21/2002-Cus dated (at sl. no. 357) denied - whether Capital Goods or not? - 'parts of dredger' - Confiscation orders - redemption fine - Penalty - Held that:- The exemption claimed by the appellant was restricted to 'parts of dredger' and the original authority relied upon the note in section XVII (within which chapter 89 of the First Schedule to Customs Tariff Act, 1975 is contained), which excludes coverage of goods falling under heading 8401 to 8479 of the First Schedule to Customs Tariff Act, 1975 therefrom, to deny connection with 'dredgers' to parts classified under heading 8412 of the First Schedule to Customs Tariff Act, 1975 - The description in the exemption notification must be read in its entirety and harmoniously in accordance with which, all parts of dredgers, including engines, must be accorded the benefit of exemption. There is no dispute that it was an engine, that was imported and not a 'generator'. Capital goods are not restricted to manufacturing activity; they find use in rendering of services or other activity that contributes to rendering of service. Dredging is a service and dredger cannot function without an engine - engines are, therefore, undoubtedly capital goods. There is no requirement of license for import of used capital goods - Confiscation order fails - appeal allowed - decided in favor of appellant.
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