ORDER
Lajja Ram, Member (T)
1. In this appeal filed by M/s. Escorts Ltd., the matter relates to the eligibility of the –
(1) 1 JISTEL 95 X16 + 80 48V ALPHA 1;
(2) Music on hold; and
(3) JISTAX billing system with two boards each for four receivers.
to the benefit of exemption Notification No. 172/77-Cus., dated 8-8-1977, as amended, and as in force on 4-9-1986 – the date of the bill of entry. The appellants imported the above goods and declared their classification under sub-heading 8517.40 of the Customs Tariff. The goods were assessed on the basis of the declared classification and the declared assessable value. The customs duty assessed was paid on 6-9-1986 and the goods were cleared out of customs charge. Under their application dated 28-11-1986, the appellants filed a refund claim with the Asstt. Collector of Customs, Refund Section, Indira Gandhi International Air Port, New Delhi. The ground taken for the refund was that the goods under import were complete system capable of working independently and was not a part. Under said Notification No. 172/77-Cus., the goods classifiable under Heading No. 85.17 were eligible for concessional rate of customs duty, but no such exemption was available to the parts containing thermionic valves or transistors or similar semi-conductor devices or electronic micro-circuits or capacitors other than paper capacitors. The refund claim was rejected on the ground that the items imported contained electronic components. On appeal, the Collector of Customs (Appeals) confirmed the order passed by the Asstt. Collector of Customs. He observed that the equipment imported consisted of electronic components i.e. thermionic valves etc. He further observed that the appellants’ contention that the telephone exchange was in unassembled condition only for the sake of transportation remained unsubstantiated, since no evidence in the invoice or from supplier or shipper to that effect is available and presented.
2. We have heard Shri Dinesh Charak, Manager (Law) for the appellants’ company and Shri A.K. Agarwal, SDR, for the respondents/Revenue.
3. Shri Dinesh Charak, Managei (Law), submitted that the goods imported were electronic item, but the exclusion under Notification No. 172/77-Cus. was only to the parts and not to the complete telephone exchange. The music on hold and the billing system were part of the electronic telephone exchange imported, and they were eligible for the benefit of Notification No. 172/77-Cus. Alternatively, he pleaded that the benefit be given to the electronic telephone exchange, if the benefit is not found admissible to the music on hold or the billing system. He referred to the relevant exemption notification and the tariff entry and pleaded that the telephone exchange imported by them being one complete item, the benefit of the notification should not be denied only on the ground that it contained electronic items.
4. In reply, Shri A.K. Agarwal, SDR, stated that the appellants were engaged in the manufacture of electronic private automatic branch exchange. The goods imported were electronic items and the benefit of Notification No. 172/77-Cus. was not available to electronic items. The bill of entry did not indicate the benefit of this notification. The goods were cleared out of customs charge without the benefit of this notification and that the view taken by the Asstt. Collector of Customs and Collector of Customs (Appeals) was correct.
5. We have carefully considered the matter. We find that at the time of the import, the benefit of Notification No. 172/77-Cus was not claimed. The goods in the bill of entry had been declared as electronic telephone exchange; music on hold; and billing system. In the bill of entry, separate price had been shown for the three items, already noted above. In the refund claim, the appellants have taken a plea that the goods imported were complete system capable of working independently and that the exclusion under the said notification was only in respect of the parts. The Notification No. 172/77-Cus. provided exemption, among others, to the goods falling under Heading No. 85.17 of the Tariff other than those specified in the corresponding entry in Column 4 of the Table annexed to that notification. Under Column 4, with regard to the relevant Tariff Heading 85.17, exclusion was provided for parts containing thermionic valves or transistors or similar semi-conductor devices or electronic micro-circuits or capacitors other than paper capacitors. In this case there is no dispute that the imported goods contained thermionic valves and were electronic items. It is also seen that the importers had pleaded that the goods imported were complete system. In other words, the parts containing thermionic valves could not be separated and the whole exchange worked on electronic system.
6. As there is no dispute that the goods imported contained electronic components, and that even the main item i.e. JISTEL was also electronic, we do not find any ground to interfere with the view already taken by the Collector of Customs (Appeals), in the matter.
7. It is also seen from the approval of the Department of Electronics that the loaded PCBs were integral part of the goods imported. In the annexure to letter No. 14(12)/84-C&C, dated 11-4-1986 it had been provided that during the CKD phase of manufacture only, the import of the specific loaded PCBs was allowed. The material imported was JISTEL 95 and the details of the loaded PCBs is contained in the annexure at page 29 of the paper book.
8. As the parts containing thermionic valves, electronic micro circuits etc. were excluded from the purview of exemption and as the parts of the goods imported contained these excluded items and as the goods imported was said to be a complete system capable of working independently, we consider that the view taken by the Collector of Customs (Appeals) was correct. We do not find any merit in this appeal and the same is rejected.