TMI Blog2008 (8) TMI 328X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt in Appeal No.1761 of 2008 filed by the present Petitioner against the Union of India-Respondent herein. 2. The brief facts of the case are, that the Petitioner is a French Company renowned in the field of underground and underwater construction applied through a tender to the Municipal Corporation of Greater Mumbai for constructing three ocean outfalls as a part of the sewerage project. The work was granted to the Petitioner in or about 1990. 3. Mr. Bharucha, learned Senior Counsel submitted that a Notification dated 2nd August, 1976 was issued by the Government notifying the project as one under sub-item 6 of clause (d) of heading 84.66(i) of the First Schedule to the Customs Tariff whereby a flat rate of 40% customs duty was charged on all items relating to the project. Heading 84.66, inter alia, states that the machinery imported should be required "for the initial setting up of a unit, or the substantial expansion of an existing unit". This heading specifically mentions and includes (i) all items of; (a) machinery including prime movers (b) instruments, apparatus and appliances (c) control gear and transmission equipments, (d) auxiliary equipments, as well as all c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be entitled to duty drawback. 5. It is the contention of Mr. Bharucha that the goods required for the project were imported by the Petitioner and the same were cleared on a provisional basis by the Petitioner executing bonds backed by bank guarantees to the Customs Authorities during the period 17th April, 1983 to 8th April, 1987. 6. The learned Senior Counsel for the Petitioner further contended that on 21st September, 1987, the 2nd Respondent had issued a Show Cause Notice to the Petitioner alleging that the goods imported by the Petitioner did not form a part of the project and thus were ineligible for the discounted customs duty rate under Notification 2nd August, 1976 or under Heading 84.66. 7. It is also submitted that though the CBEC forwarded to the 2nd Respondent its aforesaid order dated 18th October, 1984, by its letter dated 5th October, 1987, the 2nd Respondent had issued a second Show Cause Notice dated 28th October, 1987 and had showed that he had pre-decided the issue against the Petitioner and therefore aggrieved thereby, the Petitioner approaches this Court by way of the present Writ Petition. 8. Mr. Bharucha, the learned Senior Counsel for the Pet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed above provided that such spare parts, raw materials or consumable stores are essential for the maintenance of the plant or project mentioned in (1) to (6) above." 7. Heading 98.01 covers all the items of machinery including prime movers, instruments, apparatus and appliances, control gear and transmission equipment, auxiliary equipments besides components and raw materials required for the initial setting up of a unit or the substantial expansion of an existing unit of a specified industrial plant. The industrial plant would include fertilizer plant as well as it is designed to be employed directly in the performance of processes necessary for manufacture of fertilizer. Since the fertilizer plant is covered by the industrial plant specified in Heading 98.01 of the Tariff Act all the "auxiliary equipments" which are required for the initial setting up of the unit could be imported under the project import scheme. 12. It is not disputed that construction equipments imported by the Respondent were used in the initial setting up of the plant. The Assistant Collector and the Appellate Authority denied the facility of the project import as the ownership of the imported goods would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s only Rs. 70,000/- which is negligible). In fact, it was not disputed before the Tribunal or before us as well that the construction equipments imported by the Respondent were used in the initial setting up of the plant. The goods imported by the Respondent such as hydle truck cranes, excavator, shovel loader, truck, forklift truck, power generators, diesel welder, welding rectifier, containers, tools and tackles instruments, level nako with tripod and theodolite nako with accessories and tripod would certainly be auxiliary equipments which would help in the initial setting up of the industrial plant. The facility of the project import was denied to the Respondent because the ownership of the imported goods did not pass to the project authority. Since it is not disputed that the construction equipments imported by the Respondent were used in the initial setting up of the plant, then, as per the provisions of Heading 98.01 of the Tariff Act the Respondent could not be denied the benefit of the project import. 11. It is also pertinent to note that the CBEC had passed an order dated 18th October, 1984, Exhibit-"C" to the Petition and had confirmed that the goods which were being ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... held that "we are unable to hold that because a revision application could have been moved for an order correcting the order of the Income Tax Officer under Section 35 but was not moved, the High Court would be justified in dismissing as not maintainable the Petition, which was entertained and heard on merits". (b) In the case of Proctor Gamble India Limited v. Municipal Corporation of Greater Bombay - 2004 (1) Mh.L.J. 406, this Court has held that "...... it is well settled that once the Petitions are admitted for final hearing, without any reservation of right in favour of the Respondents to raise plea of non-maintainability of the Petitions on account of any such alternative remedy being available to the Petitioners, the Respondents cannot be allowed to non-suit the Petitioners, at the final stage, merely on such a technical plea and more particularly when the Petitioners have a good case on merits. Applying the same rule t the case in hand, the objection relating to the availability of alternative remedy is rejected." (c) In a Division Bench Judgment of this Court in the case of Century Spinning Manufacturing v. Union of India, 1993 (67) E.L.T. 224, it is observ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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