Per V.K. Agrawal :

The issue involved in this Appeal filed by M/s. Karl Storz Endoscopy India (P) Ltd. is whether Cold Light Fountain imported by them is exempted wholly from payment of Customs Duty as per Serial 249 of the Table annexed to Notification No. 23/98-Cus. dt. 2.6.1998.

2. The Assistant Commissioner, Customs denied the benefit of Sl.No. 249 of Notification No. 23/98-Cus to cold light fountain holding that the product manual/literature no where specified that the impugned goods was meant for Tubal occulsion; that as per manual, the cold light fountain was usable in all endoscopic intervention and whereas the benefit under Serial No. 249 is only for equipments which are meant for tubal occulsion. On appeal, the Commissioner (Appeals) also denied the benefit of Serial No. 249 of Notification No. 23/98 as the light source had been proved as accessory of endoscopes and not laproscopes or specifically for tublar occulsion; that Notification has given a general entry as endoscope and its accessories and certain specific entries for different specialised endoscopes and if it was the intention to allow benefit to all endoscopes and their accessories, there was no need for differential treatment to different endoscopes.

3.1. Shri V. Swaminathan, Ld. Advocate, submitted that Laproscopic Technique for Tubal sterilization is widely used in family planning programme in India and Laproscope consists, among other items, light source imported by them; that the procedure is as under:-

With a help of Veress Needle, the CO2 gas is insufflated at controlled pressure and flow rate into the abdominal cavity to create Pneumoperitonem (distension). Then with the help of trocar and cannula, the abdoman is punctured to pass the telescope to visualise inside structure. The light source and fiber optic light cable is utilised as source of light to be transmitted inside the abdomen to enlighten the dark area for visualization. Then the ring applicator is loaded with silicon rings and finally put into the abdominal cavity to block the Fallopian Tube called Tubal Sterilization to prevent pregnancy in woman."

3.2. The Ld. Advocate, further, submitted that light source being used in Tubal Occulsion procedure is entitled for full exemption from payment of duty; that Sl.No. 249 of the Table annexed to Notification No. 23/98 grants exemption to goods for Tubal Occulsion specified in list 25. Item No. 7 clearly specifies Light source, meaning thereby that any light source used during Laproscopic Procedure is entitled for exemption under the Notification; it does not in Technical terms specify a particular light source in the list as it simply says light source and hence any equipment providing source of light for Tubal Occulsion is automatically covered by the Notification. He also mentioned that Laparoscopic is covered under the general term of endoscopic surgery. He finally contended that the Notification nowhere states that the light source should be solely and principally used only in Tubal occulsion; that the multiple application of the impugned product should not debar the benefit of the notification as the product is used in Laproscopic procedure; that had the intention of the Government been not to allow the exemption to light sources which are used in endoscopic applications, nothing prevented them from saying so clearly in the Notification by using the term "solely", "principally", "exclusively", etc. Reliance was placed on the decision in the case of U.O.I. Vs. TISCO 1977 (1) ELT J 61 (SC) in which it was held that the exemption was granted/when duty paid pig iron was used and the exemption Notification did not say that exemption would not be available if duty paid pig iron is mixed with other non duty paid material. He also relied upon the decision in the case of Escorts Ltd. Vs. C.C. 1996 (88) ELT 279 in which it was held that merely because the instrument also carry a function other than those specified in the Notification should be a gro