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TMI Blog2015 (9) TMI 244X X X X Extracts X X X X X X X X Extracts X X X X ..... total of 8 BTS 320 and 15 BTS 310 models, valued at Rs. 26,97,741.21. During the course of investigation, statements of six persons were recorded under Section 108 of the Customs Act. On 2nd November, 1999 the Directorate of Revenue Intelligence, Chennai issued a show cause notice stating that the goods in question are "photometers" and not "auto analysers". On this basis, the revenue demanded:- (a) Duty of Rs. 1,79,11,499/- [as detailed in Annexure 11 to the Notice] towards import of BTS 302, BTS 310, BTS 320 and BTS 370 from 1994 till 1999. (b) Confiscation of goods valued at Rs. 3,31,55,908/- imported without payment of duty and sold (in the market) as auto analysers under Section 111(m) of the Customs Act, 1962. (c) Confiscation of goods valued at Rs. 26,97,741/- imported vide Bill of Entry No. 4454 dt. 27-05-99 and seized by the officers of DRI on 8.6.99 under Section 111(m) of the Customs Act, 1962. (d) Penalty under Section 114A of the Customs Act, 1962. (e) Penalty under Section 112(a)/112(b) of the Customs Act on Dr. Jayaram Chigurupati, Senior Vice President and in-charge of Diagnostic Division of the Appellant. 2. On 24th December, 1999, the assessee sent a detail ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld be applied to Analyzers in which a part of the operations are performed manually, like some in which mixing of samples and reagents is done manually but the actual analysis is done automatic. The doubt arose since a view existed that the term applied only to those instruments in which all operations, including mixing of samples and reagents are automatic. However, in one particular case of semi-automatic analyser "Technician - Chemistry Auto Analyzers', the DGHS had clarified that the term could fall within the item auto Analyzers in the predecessor Notification namely 122/94-Cus. CONFERENCE CONCLUSION: The conference was of the view that the process of analysis is automatic, though mixing of sample is done manuaIIy. It is to be noted that for the exemption to accrue under the entry at Sl. No. 77 thereto, all that is required is that the analysis has to be done automatically. TRU may, however, examine in consultation with the administrative Ministry concerned whether they would like this entry to be amended in any manner to remove ambiguity." Thus what is crucial to determine whether a medical equipment is an auto analyser or not is to see whether the analysis is do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... meter c) BTS 320 The most versatile and user friendly Semi-Auto analyser with capacity to perform ELISA with Microtitre Wells. d) BTS 370 Fully-automatic Clinical Analyser Biosystems technology to meet your requirements. I have carefully gone through the rest of the salient features of each of the above models printed elsewhere in these catalogues. There is no doubt in my mind that these equipments are auto analysers meant for conducting tests in clinical laboratories. Just because the word Photometer has been used by the manufacturer in the catalogues for two first two models, neither will these two models (BTS 302 and BTS 310) nor the other two models (BTS 320 and BTS 370) cease to be auto anlaysers. It is true that all these models are based on the principle of photometry and therefore have a photometer built-in within. It will be totally incorrect to conclude that the impugned goods are not auto analysers." 5. Having found that in point of fact what was imported was, in fact, auto analysers, the learned Commissioner held that the assessee was guilty of several manipulations which presented a description of the goods convenient for itself, but not exactly what t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the said goods were neither seized nor available now for seizure it is not possible for ordering its confiscation at this point of time. (iii) Under Section 112(a) of the Customs Act, 1962 I impose a penalty of Rs. 50,000/- (rupees fifty thousand only) on M/s Dr. Reddy's Laboratories Ltd. This amount of penalty is also ordered to be recovered by enforcing the bank guarantee furnished at the time of provisional release of the seized goods. (iv) Under Section 112(a) of the Customs Act, 1962, I impose a penalty of Rs. 5,000/- (rupees five thousand only) on Dr. Jayaram Chigurupati, Sr. Vice-President, M/s Dr. Reddy's Laboratories Ltd. (v) I drop further proceedings in respect of rest of the actions proposed in the show cause notice." 7. Against the said order of the learned Commissioner, revenue filed an appeal under Section 129D(4) of the Customs Act on 12 th April, 2002. The assessee filed a reply-cum-cross objection dated 8th June, 2002 in which the assessee specifically stated:- "In all cases, closed or open the in-built software contains programs for analysis and interpretation. The only inputs which are entered in an open system is volume of reagents to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evant, the CESTAT does not seem to have come to grips with the real issue at all. 10. This is a peculiar case in which it is clear that what has, in fact, been imported is an equipment which is to be used in a pathological lab for the automatic analysis of blood samples. It is an admitted fact that models BTS 310 and BTS 320 were imported with inbuilt software that contained programmes for analysis and interpretation. It is equally an admitted fact that an importer can change such programmes to suit its own convenience. From this it does not follow that what has been imported is only a photometer. Learned senior advocate appearing for the revenue had to admit that a photometer is an instrument which measures intensity of light. There is no necessity for any inbuilt software in such photometer unless such instrument is, in fact, to be used for the automatic analysis of blood samples. This being the case, it is clear that oral statements made by persons affiliated to the assessee to the effect that the description of the imported goods was changed from photometers to auto analysers to avail the benefit of the exemption under notification No. 20/1999, and that the foreign supplier wa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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