TMI Blog2006 (3) TMI 64X X X X Extracts X X X X X X X X Extracts X X X X ..... 985 for import of MRI Machine. (ii) Prior to the grant of import licence dated 17th December, 1985 for import of MRI machine, the first petitioner applied for recommendation certificate to the Director of Health Services, Maharashtra. The said application was processed at various levels and ultimately on 7th September, 1989 the Director General of Health Services, New Delhi granted certificate to the petitioner for the benefit of the Notification Nos.279/83-Cus dated 1st March, 1983 and No.63/88-Cus dated 1st March, 1988. (iii) Pursuant to the import licence dated 17th December, 1985 and the certificate issued by the Director General of Health Services, New Delhi regarding satisfaction of the conditions of the Notification Nos.279/83 and 64/88, the petitioners imported one MRI machine in part shipments and cleared the same for home consumption after filing four bills of entry (No.1948 dated 12 th March, 1987 and Nos.122 123 dated 2 nd May, 1988 and 11832 dated 30 th May, 1988). (iv) The petitioners applied for exemption under the Notification Nos.279/83 and 64/88. The MRI machine was allowed clearance at nil rate of duty. 4. By the show cause notices dated 14thDecemb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1987 between the petitioners and the Breach Candy Hospital and Research Centre and the Branch Candy Hospital and Research Centre satisfies the conditions of the notifications. (e) That the Notification No.64/88-Cus dated 1 st March, 1988 came to an end on 1 st March, 1994 and that brought to an end any liability of the petitioners in fulfilling the condition 2(b) of the said notification. According to him, Section 6 of the General Clauses Act has no application. 10. In support of his contentions, Mr. Baya relied upon the judgment of the Supreme Court in the case of Mediwell Hospital and Health Care Pvt. Ltd. v. Union of India, 1997 (89) E.L.T. 425 (S.C.) and the judgment of the Madras High Court in the case of Apollo Hospitals Enterprises Ltd. v. Union of India, 2001 (133) E.L.T. 58 (Mad.). 11. On the other hand, Mr. A.J. Rana, the learned senior counsel for the respondents justified the impugned order. The learned senior counsel would submit that on the basis of the declarations made in the bills of entry; the certificate issued by the Director General of Health Services and the endorsement to the effect that the items mentioned therein are essential and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecified in clauses (a) and (b)." 15. By further Notification NO.64/88 dated 1st March, 1988, the Central Government issued another exemption notification in respect of the hospital equipments imported by specified category of hospitals (charitable) subject to certification from Director General of Health Services when such equipments / apparatus / appliances were essential for the use in the hospitals specified in the table and upon fulfilment of conditions mentioned therein. 16. Para 2 under the table of the Notification No.64/88-Cus dated 1st March, 1988, reads thus : "2. All such hospital which may be certified by the said Ministry of Health and Family Welfare, in each case, to be run for providing medical, surgical or diagnostic treatment not only without any distinction of caste, creed, race, religion or language but also:- (a) free on an average, to at least 40 per cent of all their outdoor patients; and (b) free to all indoor patients belonging to families with an income of less than rupees five hundred month, and keeping for this purpose at least 10 per cent of all the hospital beds reserved for such patients; and (c) at reasonable charges either on the basi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... least 10% of the hospital beds are reserved. Having got the certificate to that effect from the Director General of Health Services by representing that the treatment facilities will be provided free to all families with an income of less than Rs.500/- per month and for this purpose at least 10% of hospital beds shall be kept reserved, we are of the view that it is not open to the petitioners to challenge the constitutional validity of clause 3(b) and 2(b) of the abovereferred notifications respectively. 19. Even otherwise, looking to the nature of the benefit granted under the notifications whereby the Central Government exempted basic import duty and the additional duty on medical diagnostic equipments and surgical equipments, we find nothing unreasonable on the part of the Central Government to impose condition for the exemption that free medical treatment to all the families with an income of less than Rs.500/- per month shall be given and reservation of at least 10% hospital beds for such inpatients shall be made. The condition imposed in para 3(b) of the notification No.279/83 and para 2(b) of Notification No.64/88 is reasonable and has nexus to the object sought to be a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y they are not entitled to the exemption under the said notifications. Even if we assume that the diagnostic centres are included within the definition 'Hospital' as per the explanation set out in the notifications, exemption from payment of basic customs duty is only available upon fulfilment of the conditions stipulated in the notifications. The diagnostic centres (for the purpose of notification deemed to be 'Hospital') which do not have the facility for inpatients as stipulated in para 2(b) of Notification No.64/88-Cus dated 1 st March, 1988, cannot get the benefit of exemption under the said notification. The whole argument of the learned counsel for the petitioner in pressing into service the legal maxim LEX NON-COGIT AD IMPOSSIBILIA and the submission that the diagnostic centre cannot meet the criteria of reservation of beds is wholly misconceived. But for the exemption Notification No.64/88, the duty was payable on the import of MRI machine by the petitioners. For getting the benefits of the exemption notification, the first petitioner has to fulfil the conditions of the said notification. If it cannot, it has to pay the duty. Re : Contention (d) 23. It is conten ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctor General of Health Services and the aforesaid judgment of the Supreme Court, no doubt is left that installing the imported equipment at Breach Candy Hospital and Research Centre and then getting the exemption from payment of duty was not permissible. Whatever arrangement or agreement the first petitioner may have had with the Breach Candy Hospital and Research Centre, such arrangement or agreement shall not absolve the petitioner No.2 from its liability of fulfilment of the conditions prescribed in the Notification No.64/88-Cus dated 1 st March, 1988. 26. In so far as the judgment of the Supreme Court in the case of Mediwell Hospital and Health Care Pvt. Ltd. (supra) is concerned, by two later decisions, two parts of the judgment in the case of Mediwell Hospital have been overruled. In the three Judge bench decision in the case of Faridabad CT Scan Centre v. D.G. Health Services, 1997 (95) E.L.T. 161 (S.C.), the Supreme Court overruled the Mediwell Hospital to the extent of invocation of Article 14. In the case of Faridabad CT Scan Centre, the three Judge Bench overruled the Mediwell Hospital (supra) to the extent indicated therein, held thus : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e expenditure and will unnecessarily add to the burden of the expenses of the hospital in question. A Bench of this Court felt that this Court having laid down guidelines in Para 13 of the judgment for the purpose of the competent authority to ensure that the conditions upon which the exemptions were granted were complied with, it would be unnecessary to have further condition imposed requiring the importers to advertise the same; that mere advertisement in a newspaper would not necessarily establish that importers have in fact complied with the condition or that the statement contained in the advertisement was correct; that further verification, in any event would be necessary; that the object is to serve the indigent patients and if such object has been carried out without dispute to the full satisfaction of the respondent authority, it was unnecessary burden upon the petitioner to require a monthly advertisement to be published indicating the details of the indigent patients treated by them as directed in the Mediwell's case (supra). It is in those circumstances, disagreeing with the view this matter was referred to a Larger Bench. 3. We have carefully perused the judgment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... priate authority and on the basis of that to have imported equipments without payment of customs duty to give free treatment atleast to 40 per cent of the outdoor patients as well as would give free treatment to all the indoor patients belonging to the families with an income of less than Rs.500/- p.m. The competent authority, therefore, should continue to be vigilant and check whether the undertakings given by the applicants are being duly complied with after getting the benefit of the exemption notification and importing the equipment without payment of customs duty and if on such enquiry the authorities are satisfied that the continuing obligation are not being carried out then it would be fully open to the authority to ask the person who have availed of the benefit of exemption to pay the duty payable in respect of the equipments which have been imported without payment of customs duty. Needless to mention the Government has granted exemption from payment of customs duty with the sole object that 40% of all outdoor patients and entire indoor patients of the low income group whose income is less than Rs.500/- p.m. would be able to receive free treatment in the Institute. That ob ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssued under such rule or regulation, is amended, repealed, superseded or rescinded, then, unless a different intention appears, such amendment, repeal, supersession or rescinding shall not- (a) receive anything not in force or existing at the time at which the amendment, repeal supersession or rescinding takes effect; or (b) affect the previous operation of any rule, regulation, notification or order so amended, repealed, superseded or rescinded or anything duly done or suffered thereunder; or (c) affect any right, privilege, obligation or liability acquired, accrued or incurred under any rule, regulation, notification or order so amended, repealed, superseded or rescinded; or (d) affect any penalty, forfeiture or punishment incurred in respect of any offence committed under or in violation of any rule, regulation, notification or order so amended, repealed, superseded or rescinded; or (e) affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment as aforesaid, and any such investigation, legal proceeding or remedy may be instituted, continued or enforced and any such penalty, forf ..... 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