Customs Appeal No. C/983 of 2009 (Arising out of Order-in-Original No. S/10-11/99 SIIB ACC dated 5-6-2009 passed by the Commissioner of Customs, ACC, Mumbai)

Decided On: 03.06.2019

Appellants: Lions Club of Poona Vs. Respondent: Commissioner of Customs (ACC & Import), Mumbai

Hon'ble Judges/Coram:
C.J. Mathew, Member (T) and Dr. Suvendu Kumar Pati


Dr. Suvendu Kumar Pati, Member (J)

1. Rejection of appellant's claim for exemption of customs duty under Notification No. 63/88-Cus against purchase of hospital equipment (C.T. Scanner) by the Commissioner of Customs (Import), Air Cargo Complex, Sahar, Mumbai is assailed in this second round of appeal.

2. Factual back drop of the case is that appellant is a charitable trust who purchased certain hospital equipment way back in 1989 including Hitachi whole body x-ray C.T. Scanner and availed duty exemption under notification No. 63/88 (1-3-1988) but subsequently, vide two show cause notices issued by two different Customs authorities, it was asked to discharge duty demand and pay penalty or show cause why the goods were not to be confiscated. The adjudication order confirmed allegation made in the show cause and also confirmed duty demand etc. Appellant challenged the same in the CESTAT and vide order No. A 303-336/08/CSTB/C-11 dated 18-6-2008 passed in the batch of appeals, order in original was confirmed along with direction to adjudicating authority to scrutinise the legality of payment of duty under section 125(2) after examining the claim of Appellant/importer for grant of exemption under notification No. 63/88-Cus. Commissioner of Customs (Import), Air Cargo Complex, after completing hearing of the issue raised in the limited remand order, gave his finding vide his order dated 5-6-2009 that appellant did not qualify to avail exemption notification 63/88 Cus conditionalities and issued direction for confiscation of goods, redemption of fine as well as penalty that was earlier adjudicated in the order-in-original dt. 30-1-2001 and confirmed by the CESTAT. The appellant is before us challenging legality of such order.

3. We have heard both the parties at length, who reiterated the submission made in the earlier proceedings before the CESTAT. Added submission of the Learned Counsel for appellant which bears significance to the present issue in hand is that being a public charitable trust, appellant is subjected to control of the Joint charity Commissioner, Pune and also to the Directorate of Health Services, Government of Maharashtra as well as to other Central and State authorities for which it is entitled to avail the exemption provided under notification No. 63/88. He also raised issue of double jeopardy, as Appellant was subjected to two show cause notices by different Customs authorities. The Learned AR for the Department, on the other hand, redirected the findings of Commissioner of Customs (Import) and supported the reasoning and rationality of the order passed by him.

4. Going by notification No. 63/88-Cus dated 1st march 1988, it can be seen that exemption is provided to the hospital equipment when imported by Central, State Government hospitals etc. or society registered under any law for the time being relating to registration of societies, which are being controlled by any of the authorities of the Central Government, State government, Union Territory Administration or local authorities. The meaning of word "control" is the power to influence or direct or supervise the behavior and conduct of people or organization in the course of event and "government control" signifies the control exercised over the action or affairs by the State. As found from the order of the Commissioner of Customs (Import), the only claim that was established by the appellant relating to control of the State Government is filing of returns under the Act and nothing more was substantiated before him. The Commissioner of Customs (Import) had given his views that such control by Government authorities requires managerial control on day to day functioning of such society, which is admittedly found absent in the case of the appellant. Apparently therefore, he had given his finding that requirements of exemption notification was not fulfilled in that aspect. Furthermore another condition available in notification 63/88 that the hospital, which includes expression like trust or society, had to produce a certificate from the Director of Health Services of the Government of India or the Ministry of Health and Family welfare in the Government of India to the effect that the said hospital falls in either of the categories specified in the table (which includes registered society). Such certificate was not produced by the appellant to make it eligible for exemption under notification No. 63/88-Cus. Conversely Appellant failed to substantiate that Commissioner's finding was wrong in respect of production of such certificate and in respect of exercise of Government control over its functioning that would necessitate interference of the Tribunal in the order passed by the Commissioner (Appeals).

5. Moreover double jeopardy is a protection against punishment for more than one occasion and not against repeated intimation for action/proceedings. Hence the Order.

The Appeal is dismissed and the order passed by the Commissioner (Appeals) S/10-11/99 SUB ACC dated 5-6-2009 is hereby confirmed.

(Order pronounced in the Court on 3-6-2019)

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