TMI Blog2003 (3) TMI 513X X X X Extracts X X X X X X X X Extracts X X X X ..... 95. They have cleared the goods viz. PCB test equipment to domestic tariff area on payment of 50% of Customs duty applicable and 50% of Central Excise duty as per Notification No. 13/81-Cus., dated 9-2-81 read with Notification 2/95-C.E., dated 4-1-95. They have also claimed the rate of duty at 15% as a concession as per Notification 56/88-Cus. According to the department, as per the product literature, the product appeared to be only a PCB tester. It was also revealed that the test equipments were sold only to customers other than manufacturers of goods falling under 85.42 and therefore the department took the stand that the assessees are not eligible to claim the benefits of Notification 56/88-Cus., dated 1-3-88. Proceedings were therefore, initiated by issue of show cause notice dated 30-4-96 and the proceedings resulted in the order of the original authority demanding duty as noted above which on appeal was set aside by the Commissioner (Appeals) under order impugned. Aggrieved by the said order of the Commissioner (Appeals), the Revenue has filed this appeal on the following grounds : (a) The Govt. has granted exemption to the goods falling within chapters 84 or 85 or 90 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not there in the Notification. Further, there was no end-use condition in the Notification for availing the exemption under this Notification, according to the learned Sr. Counsel and the only condition is that the goods should be capable of being used and need not be actually used in the manufacture of goods falling under chapter sub-heading 8542.00. He has also relied upon the certificate dated 2-4-1996 issued by the Electronic Corporation of Tamil Nadu (A Govt. of Tamil Nadu Undertaking) which certifies that M/s. Qmax Test Equipment Pvt. Ltd. are manufacturers Exporters of Bench-Top General Purpose PCB Diagnostic and Repair System which are used for testing of LSI (Large Scale integration), VLSI (Very Large Scale Integration) Circuits, Micro sub-assemblies and Printed Circuit Boards . He vehemently argued that the item being a testing equipment is required for item falling under 85.42, and the item need not really go into the manufacture of Electronic Integrated Circuits and Micro-assemblies . He, therefore, argued that there is no room for further discussion after having accepted that the impugned item viz. LSI/VLSI tester is capable of being used by the assessee. He also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... First Schedule, when imported into India, from so much of that portion of the duty of customs leviable thereon which is specified in the first Schedule, as in excess of the amount calculated at the rate of 15% ad valorem. TABLE 1. LSI/VSLI tester 2 to 38 xxxxxxx On a plain reading of the above Notification it is clear that what is required to be imported is LSI/VLSI tester required for manufacture of item falling under 8542.00 viz. Electronic integrated Circuits and micro-assemblies . The language used in the Notification relates to specific requirement for manufacture of a particular item and it has to be shown that it is required by the manufacturer of that item falling under Chapter 85.42 item. 7. In the present case the goods manufactured by the assesssee is Bench Top General Purpose PCB Diagnostic and Repair System of various models which is used for testing of LSI (Large Scale Integration) VLSI (very large scale integration ) Circuit, Micro-sub-assemblies. As per their reply to the show cause notice dated 1-7-1996 filed in paper book PCB tester manufactured by them is not different from LSI/VLSI tester whereas, the certificate produced by them from Electronic Corp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the phrase and are required for manufacture of goods falling under chapter 85.42 has been used in the Notification, the benefit of notification can be extended only when it is actually required by the manufacturers of goods falling under that heading. In the present case, the assessee has not rebutted that buyers are not the manufacturers of the specified goods. Thus the assessee not having discharged the burden cast on them, are not entitled to the concession envisaged in the Notification. The conclusion arrived at by the Commissioner (Appeals) is that the Notification does not indicate required and used for the manufacture and therefore, it need not be sold only to the manufacturers and there is no end use condition in the Notification. In terms of the law laid down by the Hon ble Apex Court as noted above, we are not required to examine those phrases and words which are not employed in the Notification such as used for manufacture or about the end use condition, and we have to go strictly according to the words used in the Notification which we have done, as discussed above. The case law in the matter of Sha Harakchand Dharkaji v. CC, Madras reported in 1996 (86) E.L.T. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure of goods falling under 85.42. I find that this is interpolating the notification with the word manufacturer . The notification only indicates required for the manufacture of goods under 85.42 . It does not say anything about the manufacturer. The buyer need not be therefore manufacturers of the product. Secondly, the notification does not say that the goods should be used for the manufacture. It only says that required for the manufacture. It is much more liberal than the word used . 4.2 further, the Assistant Commissioner has held that the appellants have not rebutted that buyers are not manufacturers of the goods falling under 85.42. As rightly mentioned by the advocate, the notification does not indicate required and used for the manufacture. In the circumstances, it need not be sold only to the manufacturer. As long as it is proved that the goods are required for the manufacture of goods under 85.42, the benefit of the concessional exemption can be given. As mentioned by the advocate, there is no end use condition specified as in the case of Notification 45/94 and other such exemptions. All that the notification 56/88 requires is that the equipments mentioned are r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding 85.42. The term used in the notification is required for manufacture . The simple interpretation that has to be imported to these words are as to whether they are necessary for the purpose of manufacture of goods falling under chapter heading 85.42. It is not for us to include other meanings than to give a simple meaning of its utility in the manufacture of goods falling under chapter heading 85.42. The importation of the term used in the manufacture of goods is not proper and to hold that it is required to go into the goods to be manufactured by the assessee himself or by the person who are using it. So long as it is shown by the expert opinion, as has been shown in the present case, that it is required for use for testing of LSI/VLSI circuit micro assemblies and printed circuit board, the benefit has to be extended. In the present case, M/s. Electronic Corporation of India Ltd., a Govt. of India Enterprise has certified that the item is for testing of the said LSI/VLSI etc. In view of absence of any end-use condition in the notification, the benefit cannot be denied. It cannot also be included that the goods are required and sold for the manufacture of items falling under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he same and that the benefit of the said notification has been rightly extended to the goods in question. Sd/- (Jeet Ram Kait) Member (T) Sd/- (S.L. Peeran) Member (J) 13. [Order per : G.A. Brahma Deva, Member (J)]. - Whether the item, LSI/VLSI tester is eligible for the exemption benefit or not in terms of Notification No. 56/88-Cus., dated 1-3-88 is the issue to be considered herein. 14. The department was of the view since the item in question was sold to the buyer, who is not the manufacturer, the same is not eligible for exemption in terms of the aforesaid notification. This view was confirmed by the Member (Technical) as can be seen from his proposed order. 15. On the other hand, Member (J) has taken the view that in the absence of the word used for manufacture in the exemption notification, the word requirement as such cannot be read that it must be used in the manufacture of the goods. The Commissioner as well as the Member (J) has arrived at the conclusion based upon the ratio of the judgment of the Supreme Court in the case of State of Haryana v. Dalmia Dadri Cement Ltd., 1988 (14) ECR 292 (S.C.) and also relied upon the decision o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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