- (1.) All these appeals are being disposed of by this common judgment as the facts are identical and they all involve a common point.
(2.) In all these appeals the respondents are manufacturers of textile garments. By Notification bearing No. 29/97-Cus dated 1st April, 1997 exemption from custom duty was granted to capital goods, components and spares thereof etc. imported under the Export Promotion Capital Goods Scheme (for short EPCG Scheme). The relevant portion of the Notification reads as follows : "Exemption to capital goods, components and spares thereof etc. imported under EPCG Scheme.- In exercise of the powers conferred by sub-section (1) of S. 25 of the Customs Act, 1962 (52 of 1962), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts goods specified in the Table annexed hereto from whole of the duty of customs leviable thereon which is specified in the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) and from so much of the additional duty leviable thereon under S. 3 of the said Customs Tariff Act, as is in excess of the amount calculated at the rate of 10% of the value of goods : Provided that where the said goods are required for- (i) the manufacture of leather garments, textile garments (including knitwears), agro products and products of horticulture, floriculture, poultry and bio-tech products, or (ii) rendering services to hotel industry, such goods shall be exempted from the whole of the additional duty leviable thereon under S. 3 of the said Customs Tariff Act. xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx 6. The capital goods imported, assembled or manufactured as installed in the importer's factory or premises and a certificate from the jurisdictional Assistant Commissioner of Central Excise or Independent Chartered Engineer, as the case may be, is produced confirming installation and use of capital goods in the importer's factory or premises, within six months from the date of completion of imports or within such extended period as the said Assistant Commissioner of Customs may allow. xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx Explanation.- In this Notification- (1) "Capital goods" means,- (i) any plant, machinery, equipment and accessories required for- (a) manufacture or production of other goods, including packaging machinery and equipments, refractories, refrigeration, equipment power generating sets, machine tools, catalysts for initial charge, and equipment and instruments for testing, research and development, quality and pollution control; (b) use in manufacturing; mining agriculture, aquaculture, animal husbandry, floriculture, horticulture, pisciculture, poultry, viticulture and sericulture; and xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx (4) "export obligation"- (i) in relation to importers other than hotel industry rendering services, means export to a place outside India of products manufactured with the use of capital goods imported, assembled or manufactured in terms of this Notification or making of supplies of such products in terms of Cls. (a), (b), (d), (e), (f) and (g) of paragraph 10.2 of the Export and Import Policy; and xxx xxx xxx xxx xxx xxx xxx xxx xxx xxx"
(3.) Thus capital goods imported under the EPCG Scheme were exempted from payment of customs duty and so much of additional duty as was in excess of 10% of the value of the goods. Under the proviso if the capital goods were imported for manufacture of items mentioned therein then they were exempted from payment of whole of the additional duty. Thus, if the capital goods were imported for manufacture of textile garments then, under this Notification, the importer would be exempted from payment of customs duty and additional duty.;