1. The question for decision in these fifty-four (54) appeals arising out of four(4) Orders-in-appeals dated 21-5-1981, 18-9-1981, 5-8-1982 and 8-10-1982 is whether Floppy Disk Drive, Line Printers, Magnetic Tape Drive, Dot Matrix Printers and Digital Tape Transport imported by the appellants under various consignments and Bill of Entries are entitled to benefit of duty concession under Notification Nos.
272-Cus., dated 2-8-1976, 47-Cus., dated 1-3-1979 and 115-Cus.,dated 19-6-1980. Notification No. 272-Cus., dated 2-8-1976 exempted Computers and Computer Systems falling under sub-item No. (2) of Heading No.84.51/55 of the First Schedule to the Customs Tariff Act, 1975 from so much of the portion of the duty of Customs leviable thereon as was in excess of 40 % ad valoerm and the whole of the Addl. duty leviable thereon under Section 3 of the Customs Tariff Act, 1975. Notification No. 47-Cus., dated 1-3-1979, which superseded Notification No.272-Cus., dated 2-8-1976 exempted Computer and Computer Sub-system falling under sub-heading No. (2) of heading 84.51/55 of the said Schedule from so much of the portion of the duty of the Customs as was in excess of 40% ad valorem and so much of Additional duty of Customs as was in excess of 10% ad valorem. Notification No. i 35-Cus., dated 19-6-1980 which superseded Notification No. 47-Cus., dated 1-3-1979 exempted Computer and Computer peripheral Units falling under sub-heading No. (2) of heading No. 84.51/55 of the said Schedule from so much of duty of Customs as was in excess of 40 % ad valorem. It would be seen, that while the first two notifications used the term Computer subsystems, Notification No. 115-Cus., dated 19-6-1980 inter alia used the expression Computer pheripheral Units.
2. The main point for decision in these appeals is whether terms Computer sub-system and computer peripheral units are synonymous and the. goods imported by the appellants fell within their meaning.
3. By Orders-in-appeal dated 21-5-1981, the Appellate Collector of Customs, New Delhi disposed of 12 appeals. In these appeals, the appellants had imported four consignments of Line printers, two consignments of Digital Tape Transport and six consignments of Floppy Disk Drive. The appellants had claimed concession under Notification No. 272-Cus., dated 2-8-1976. The learned Appellate Collector of Customs held that the goods could not be considered as sub-system of computer or even peripherals for computers. He rejected the appellants claim for concessional assessment under Notification No. 272-Cus., dated 2-8-1976. By another order-in-appeal dated 18-9-1981, the learned Appellate Collector of Customs, New Delhi decided 12 appeals. In these cases, the appellants had imported 7 consignments of Line printers, one consignment of Floppy Disk Drive and two consignments of Magnetic Tape Drive and had claimed benefit of partial exemption from duty in terms of Notification No. 272-Cus., dated 2-8-1976 and Notification No.47-Cus., dated 1-3-1979. From the Memo, of appeal, it appears that in these 12 appeals, two related only to refund of countervailing duty and the appellants have filed appeal only in respect of 10 cases, disposed of by this order. They have also stated that separate action would be initiated in respect of other two cases. The learned Appellate Collector of Customs, New Delhi by this order inter alia held that Line printers, Digital Tape Transport and Floppy Disk drive are not part of the Central processor unit of the computer system and they are in the nature of ancillary equipment. He held that the appellants were not eligible for concessional assessment under Notification No. 272-Cus., dated 2-8-1976 (there is no reference to Notification No. 47-Cus, dated 1-3-1979 in the order to which appellants referred in their Memo, of Revision application). By a number of identical orders dated 5-8-1982, the Appellate Collector of Customs, New Delhi rejected the appellants claim for concessional assessment under Notification No. 272-Cus., dated 2-8-1976. In these cases, it appears that the appellants had imported Floppy Disk Drive and had claimed concession under Notification No. 47-Cus., dated 1-3-1979. The order passed by the Appellate Collector of Customs, New Delhi is a copy of the earlier order, dated 18-9-1981 referred to above. By a number of orders dated 8-9-1982, the Appellate Collector of Customs, New Delhi rejected the appellants claim for concessional assessments under Notification No.272-Cus., dated, 2-8-1976 and Notification No. 47-Cus., dated 1-3-1979 following his earlier order.
4. From the grounds of appeal, it appears that in these cases, the appellants had imported Magnetic Tape Drive for use as peripherals of data processing system. A statement showing the particulars of the goods imported, the notification under which the appellants claimed concessional rate of duty, orders-in-appeal Nos. with date and numbers assigned by the Tribunal to the appeal has been filed by the appellants. This has been checked by the respondent and the Bench was informed that the information contained in this statement was correct.
The statement is annexed to this order as Schedule-A to be read as part of the order.
5. At the hearing of the appeals, Sh. K. Narasimhan, Advocate for the appellants argued that phrase 'Computer sub-systems' used in Notification No. 272-Cus., dated 2-8-1976 and No. 47-Cus., dated 1-3-1979 and Computer peripheral units used in Notification No.115/80-Cus., dated 19-6-1980 are synonymous. He submitted that the goods imported by the appellants fell within the purview of these phrases. He argued that the expressions had obviously been used by the Government of India in the Ministry of Finance on the advice of or in consultation with the Department of Electronics. Therefore, any clarification of the scope and coverage of these notifications by the Department of Electronics should have persuasive value, if not binding effect. On this argument, the Deptt. of Electronics O.M. dated 2-5-1980 should be taken as authoritative, when it says that the Ministry of Finance. CBE&C in their letter F. No. 346/10/80-TRU, dated 8-4-1980 addressed to all the Collectors of Customs and Central Excise had clarified the scope of the expression "Computer subsystem: " to mean only "Computer peripheral units" and that this clarification would apply to Notification Nos. 47-Cus. of 1979 and 272-Cus. of 1976. He also relied on a similar communication dated 9-10-1979 addressed by the Department of Electronics to the Digital Systems International in regard to Floppy Disk Drive, Line Printer and Magnetic Tape Drive being covered by the term 'Computer sub-system' used in Notification Nos.
272-Cus., and 47-Cus., of 1976 and 1979. He further argued that his contentions and the clarification mentioned above were supported by opinions expressed by independent bodies like Centre for Applied Research in Electronics, I. I. T., Delhi, M/s. Control Data Corporation Ltd., M/s. C.H. Krishnan and Associates Ltd., Delhi and Encyclopaedia Britannica, 15th Edition (on Computer Fundamentals), definitions contained in New Penguin Dictionary on Electronics and Dictionary of Computers and the write-up in International Encyclopaedia of Sciences, Newmans. Detailed literature about the goods imported was submitted before the Bench. A letter dated 20-12-1983, from the Department of Electronics, addressed to Administrative Manager of the appellants about the five items involving in these appeals was also relied on. He relied on para-9 of Chapter-2 of Import Policy April-1980-March, 1981; wherein 'Computer system' is defined to mean all types of electronic data processing computers, their peripheral equipment, magnetic tapes and disc-packs. He also relied on the meaning of expression 'automatic data processing machine' given in Customs Tariff Act and the interpretation given by the C.B.E. & C in their file No. 25/63/70-Cus (T)' dated 1-2-1972 (T. A. No. 6 of 1972) printed in Indian Customs Tariff Guide, 14th Edn. Reliance was also placed on two decisions of the Tribunal :Operation Research Group, Baroda V. Collector of Customs, Bombay Order No. B-486/83, (ii) Order No. B-250/1983 dated 13-4-1983 in British Airways, Bombay V. Collector of Customs, Bombay.
In the first case, the Tribunal held that Floppy Disk Drive Model FD-511 are parts of computer sub-systems entitled to the benefits of Customs Notification No. 272-Cus./76, as amended by Notification No.47-Cus./79. It has been urged that the floppy disk drive involved in the present appeals is similar to floppy disk drive decided in the above cases. This has not been disputed by the other party. In the British Airways' case, the Tribunal decided that Computer Select System Section 2686 are computer system eligible to concession under Notification No. 272-Cus., dated 2-8-1976.
6. Sh. Narasimhan also argued that Collector of Customs (Appeals) Delhi by his order dated 1-8-1983 in number of appeals in respect of identical cases imported by the appellants held that they were eligible to concession under the notification holding that they were computer sub-systems or computer peripheral units. These orders have been accepted by the Government and had not been challenged in appeal.
7. The appellants have filed technical data/literature to show that the Digital Tape Transport imported by them in the present case is similar to the goods covered by the case of British Airways decision. Sh.
Narasimhan, learned Advocate has also relied on Explanatory Notes to the B. T. N. (CCCM) pages 1346 to 1346F, in support of his arguments.
8. From the above, it would be seen that floppy disk drive and digital tape transport are covered by two decisions of the Tribunal. The respondent has not disputed the items in the present appeal to say that they are dis-similar to the goods which were subject matter of the earlier Tribunal decisions. In respect of these two items, therefore, benefit of concession under the notification as was applicable at the time of import would have to be given.
9. On behalf of the respondent, Sh. K.V. Kunhikrishnan, J. D. R. in writing confirmed as under : "1. In similar and identical cases decided subsequently by the Collector of Customs (Appeals) Delhi, 39 appeals of the appellant Company have been allowed by him. The Classification of the goods, viz. Magnetic tape drive, Line printer and floppy disc drive of similar/comparable types imported during the period have been ordered to be made under Heading 84,51/55 (2) of the Customs Tariff read with the concessions under Notification No. 272/76 and 47/79 (vide his order C. No. Appl/DLH/Cargo/46/82, dated 7-8-1983-Order Nos. 1223 to 1238 and 1240 to 1262, dated 7-8-1983). The respondent Collector has chosen not to appeal to the Tribunal against these orders of the Collector (Appeals). It is agreed that the goods are in fact describable as computer sub-system and/or peripherals.
2. The Department of Electronics have in their letter No. 20 (IV)/78-Comp. (PC) dated 2-5-1980 referred to in CBEC'S letter No. 346/10/80-TRU. dated 8-4-1980 clarified that the expression "Computer sub-system" would mean only computer peripherals. The above clarification has been accepted by the Ministry of Finance.
3. The Collector of Customs in the Tariff Conference have already decided that floppy disc drive and line printer imported with NELCO 3000 are to be treated as peripheral devices.
In view of the above, and in view of the fact that the department agrees with the line of argument adopted by the Collector (Appeals) (Sh. N.V. Raghavan Iyer) in his orders dated 7-8-1983, the department does not propose to contest the present appeals.
Under the circumstances, it is also submitted that it is not considered necessary for the Department to agree or disagree with the various averments and arguments made by the appellants in writing or otherwise in the present matter." 10. During the course of arguments, a question was put by the Bench, whether on a claim for proper assessment and classification being admitted by the respondent, the Tribunal could still enter into the question of correct classification and assessment or the Tribunal ought to mechanically accept the concession or admission and give relief to the appellants accordingly. On this aspect, Shri V. Lakshmi Kumaran, SDR who appeared with Shri K.V. Kunhikrishnan, D.R. on the date this issue was heard submitted that in such a case the proper course for the Tribunal to adopt would be to accept the admission or concession and allow the appeal. His argument was that in such a case no dispute survived before the Bench. Shri K. Narasimhan, learned Advocate for the appellants also adopted this approach. In this connection, he invited Bench's attention to three decisions of the Tribunal viz. Orders No.291/1983-C, 327/1983-C and C-28/1984. A perusal of these decisions shows that the concession made by the respondent was accepted by the Tribunal and the merits of the cases were not gone into. Sh.
Narasimhan, Learned Counsel also relied on the following decisions: (iii) V. Ramaswamy Iyengar V. C.I.T., Madras, (1960) 40 I.T.R. 377 at page 395 and and argued that because respondent has conceded the case of the appellants, it was not open to the Tribunal to set up its own case against the appellants but to allow the appeal without going into its merits only on the consideration that the respondent has conceded the case and consequentially the appellants are entitled for relief sought for. This should also not cause any prejudice to reconsideration or reagitation of the matter by the respondent in an appropriate case and the Tribunal would also be free to take its own view in the light of submissions then made on behalf of the parties.
11. We are not inclined to agree with the parties that in every case, the Tribunal is invariably bound to accept the concession or admission made by respondent Collector. Proper assessment or classification in a given case would ordinarily be a mixed question of fact and law or a pure question of law. While an admission on facts should generally be accepted as good evidence and binding on parties, the Tribunal may in its discretion still require the facts admitted to be proved otherwise than by such admission (see Section 58 of the Evidence Act). As far admission of law, it is well settled that an admission on point of law would not be binding. It is therefore not acceptable that interpretation of a Tariff Item, heading or Notification should be left for decision on consent of parties. Where the Tribunal feels that accepting such concession would lead to erroneous interpretation of items heading or notification it would be open to the Tribunal not to accept the concession or admission made by the Department and decide matter ignoring such admission though occasion for use of this power should seldom arise. As to. when or in what cases this should be done cannot be exhaustively laid down in an inflexible formula.
12. In the present appeals, as already pointed out, two items have already been held by the Tribunal to be Computer sub-systems and peripherals. About the remaining three items the question whether they are computer peripherals or sub-systems is primarily a question of fact. There would appear no good reason for not accepting the concession or admission made by the respondent that use of the expression sub-system in the two earlier notifications and peripherals in the third notification was intended to convey the same meaning. In view of this concession or admission being accepted, it is not necessary to discuss in detail the technical and other data adduced by the appellants.
13. As a result, the orders under appeal are set aside and the appellants granted benefit of Notification Nos. 272-Cus, dated 2-8-1976, 47-Cus., dated 1-3-1979 and 115-Cus., dated 19-6-1980, as they were applicable at the time of each import.
14. The appeals are thus allowed, with consequential relief to the appellants.