2006 (3) TMI 154 - HC - Customs

Summary

Issues:
Challenging common adjudicating order on two Bills of Entries dated 23-9-1994 and 23-12-1994.

Analysis:
The petitioners contested a common adjudicating order by the Commissioner of Customs regarding two Bills of Entries dated 23-9-1994 and 23-12-1994, concerning the import of Ostomy products from the United States Surgical Corporation. The products were described as life-saving disposable sterilized items used in cancer surgeries like colostomy. The petitioners claimed clearance under the OGL Import Export Policy 1992-1997 and sought exemption under Notification No. 208/Cus., dated 22-9-1981. They provided certificates from leading Cancer Surgeons and suppliers to support their claim.

Regarding the first petition filed on 23-9-1994, the petitioners' products were previously cleared under OGL after obtaining clarifications from relevant authorities. The Directorate General of Health Services confirmed that the imported products were covered under the OGL and the exemption notification. The petitioners also furnished certificates from Cancer Surgeons and suppliers to validate the medical utility of the products in cancer surgeries.

The assessment order passed by Respondent No. 2 on 8th July, 1998, denied the petitioners the benefit of duty exemption under Notification No. 208/81-Cus. The adjudicating officer concluded that the exemption applied only to products explicitly mentioned in the notification and post-operative products, not those used before or during surgery. However, Clause (c) of the Notification allowed for exemption for life-saving drugs or equipment certified by the Health Services authorities, which the petitioners had obtained.

The court acknowledged the certificates obtained by the petitioners from the Director General of Health Services, New Delhi, confirming the life-saving nature of the imported products. As a result, the court quashed the impugned order dated 8th July, 1998, and directed the cancellation of bonds executed by the petitioners. The judgment favored the petitioners based on the provisions of Clause (c) of the Notification and the obtained certificates, appreciating the fair stand taken by the Respondents' Senior Counsel.

In conclusion, the court ruled in favor of the petitioners, setting aside the adjudicating order and granting them duty exemption based on the certificates obtained from the Health Services authorities, as per the provisions of the Notification.