2004 (6) TMI 462 - AT - Customs

Summary

Issues:
Appeals challenging Customs Commissioner's orders granting exemption under Notification No. 29/97-Cus. for imported machines used in garment-making.

Detailed Analysis:

Issue 1: Eligibility for Exemption
The appeals by the revenue contest three orders of the Customs Commissioner granting exemption under Notification No. 29/97-Cus. to textile garment manufacturers for imported fabric-dyeing and calendering machines. The original authority denied the exemption, citing the machines were not directly used in garment-making. However, the first appellate authority overturned this decision, relying on Tribunal cases like M/s. Rupa & Co. Ltd. and Premina Exports, which specified that fabric-dyeing and calendering machines were covered by specific entries in the notification. The Commissioner (Appeals) upheld this decision, granting exemption to the imported machines.

Issue 2: Arguments and Counter-arguments
During the hearing, the revenue reiterated their stance based on a Board's circular, stating that only machines directly used in garment-making could claim exemption. They also mentioned appeals to the Supreme Court against Tribunal decisions in Rupa & Co. Ltd. and Premina Exports. However, the respondent's consultant justified the orders, citing the Tribunal's decisions. The Tribunal noted that previous cases had established that machines used at any garment-making stage were eligible for exemption, and the machines in question were used for dyeing or calendering, aligning with the Tribunal's previous rulings.

Issue 3: Tribunal's Decision
The Tribunal found that the issue was settled in favor of the assessees based on prior Tribunal decisions, which clarified that machines used in garment-making stages were eligible for exemption. The Tribunal referenced a flow-chart in Premina Exports, illustrating garment-making stages, including dyeing and calendering. As the Supreme Court had not stayed the Tribunal's decisions, the Tribunal saw no reason to interfere with the Commissioner (Appeals)'s orders, ultimately rejecting the revenue's appeals.

In conclusion, the Tribunal upheld the Commissioner (Appeals)'s decision to grant exemption under Notification No. 29/97-Cus. to the imported fabric-dyeing and calendering machines, based on established precedents and interpretations of the law regarding machines used in garment-making processes.