Per Shiben K. Dhar :

This Appeal is directed against order in Appeal No. H-341/87-BOM dt. 28.9.87 of Collector of Customs (Appeals).

2. The question involved in this appeal is whether form, fill and seal machine is eligible to exemption under Notification No. 125/86 dt. 17.2.86. The Assistant Collector held that the machine as imported incorporated a gas flushing service. It did not incorporate flushing vacuumising equipment. Since Notification No. 125/86 under sl.No. 17 referred to FFS with vacuumising and inert gas flushing the appellants were not eligible to exemption. Collector (Appeals) upheld the order of the Assistant Collector. Hence this appeal.

3. Arguing for the appellants the Ld. Counsel submits that what is indicated in Sl. No. 17 of the Notification is a machine with one of the functions. How these facilities are to be utilised depends upon the type of goods which have to be packed. For instance they have to 1; use inert gas because vacuuming in case of sweets would have the effect of deflating the packages. In case of meat products vacuumising is the only method adopted for packages. In any case the machine they imported was gas flush packing system and would also be covered in the alternative under Sl.No. 18 of Notification No. 125/86. He submitted that in case of Unipac Vs. C.C., reported in 1989 (42) ELT 242 (T) this Tribunal held that automatic form, fill and seal machine for flexible packing materials with gas flushing intended for packing product was exempted from payment of duty under Notification No. 47/84-Cus. The question of exemption to such machine again came up for consideration of the Tribunal in case of Consolidated Petrotech Industries Ltd. Vs. C.C. reported in 1992 (57) ELT 81 (T). The Tribunal (though the earlier order does not appear to have been cited in this case) after considering a series of decisions came to the conclusion that the word "and" has to be disjunctively read as "or". Both the system gas flushing and vaccumising can be imported as accessories. Tribunal, therefore, concluded that the appellants in that case were eligible to exemption under Sl.No. 17 of Notification No. 125/86.

4. Ld. D.R. reiterated the departmental arguments. He fairly concedes that in view of the Tribunal's two orders, he would leave the matter to the discretion of the Bench.

5. We have heard both sides. In case of Unipac Vs. C.C. it was held, with reference to the Notification No. 47/84-Cus. that the system is for flexible packaging. This order which considering that there was no vaccumising in the subject machine held that these machines could be called a packing for flexible packaging system and therefore were exempted under Sl.No. 7 of Notification No. 47/84-Cus.

5.1. The matter relating exemption of form, fill and seal where the machines were only gas flushing facilities having no vacuumising facilities again came up before the Tribunal in case of Consolidated Petrotech Industries Vs. C.C. 1992 (57) ELT 81 (T). The Tribunal after considering series of decisions came to the conclusion that the word "and" used in Notification No. 128/86 against sl.No. 17 has to be read as "or". The main reasoning which led the Tribunal to arrive at this conclusion emerges from para 9 of the Tribunal's order which is extracted below.

The appellants have urged that the word "and occurring in the expression FFS with vacuumising and inert gas flushing should be read as `or'. In other words, it is urged that the benefit of concessional rate of duty would be available either to FFS with vacuumising or FFS with inert gas flushing. If the word `and' is not read as `or', it has been contended by the appellants that anomalies and absurdities, will arise. Referring to those anomalies and absurdities, it has been pointed out that vacuumising with FFS machine is normally used for packing of meat and meat products whereas, gas flushing system is used for packing vegetables and vegetable products. Either of the system is an accessory to th