IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO.1106 of 2011 FOR APPROVAL AND SIGNATURE:

HONOURABLE MR. JUSTICE A.S. SUPEHIA and HONOURABLE MR. JUSTICE PRANAV TRIVEDI =================================================

Approved for Reporting Yes No ✔

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ATLAS DYE CHEM INDUSTRIES Versus UNION OF INDIA THRO. SECRETARY, MINISTRY OF & ORS.

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Appearance:

MR MIHIR H PATHAK(5261) for the Appellant(s) No. 1 MR CB GUPTA(1685) for the Opponent(s) No. 2,3 RULE SERVED for the Opponent(s) No. 1 ==================================================

CORAM:HONOURABLE MR. JUSTICE A.S. SUPEHIA and HONOURABLE MR. JUSTICE PRANAV TRIVEDI Date : 11/03/2026 ORAL JUDGMENT (PER : HONOURABLE MR. JUSTICE A.S. SUPEHIA)

1. Heard learned advocate Mr. Mihir Pathak for the appellant and learned Senior Standing Counsel Mr. Maunil Yajnik for learned Senior Standing Counsel Mr. C.B. Gupta for the respondents.

2. By the order dated 27.08.2012, the Coordinate Bench of this Court had formulated the following substantial questions of law:-

“1. Whether the Tribunal is justified in confirming the demand of duty under Order-in-Original in view of the fact that the "High Performance Liquid Chromatograph Machines" was installed in the Laboratory attached to the factory of the Appellant itself, and though vide letter dated 18.1.2002 the conditions of licence was regularised by the Director General of Foreign Trade, Ahmedabad, subsequent to earlier communication dated 9.2.1999?

2. Whether the Tribunal is justified in confirming the demand of differential duty in view of the fact that the condition no.6 of the notification dated 5.6.1995 has been amended by the Central Government widening the scope of the word "Factory" in subsequent notification dated 30.6.1998 and regularised the condition no.6 in the Notification no.110 of 1995 dated 5.6.1995 ?

3. Whether the Tribunal is justified in coming to a finding that the Director General of Foreign Trade is not the proper authority to examine the availability of the customs notification and the same is the job of the customs officer and the DGFT authority cannot dilute the conditions of the Customs Notification. Therefore, whether the Tribunal is justified in holding that installation of machines at the laboratory amounts to breach of Condition no.6 of the Import Licence ?”

3. In the present Tax Appeal, the case of the respective parties hinges on two notifications viz (1) Notification No. 110/95-Cus dated 05.06.1995 and (2) Notification No. 42/98-Cus dated 30.06.1998. The present Tax Appeal emanates from the judgment and order dated 06.12.2007 passed by the Customs, Excise and Service Tax Appellate Tribunal, West Zonal Bench, Ahmedabad (for short “CESTAT“) in Customs Appeal No. C/ 27/2004 and the order dated 17.03.2008 passed in Rectification Application No. 62 of 2008.

4. The facts as recorded by the CESTAT in the judgment and order dated 06.12.2007 are not in dispute. The appellant was Export Promotion of Capital Goods (EPCG) license holder bearing no. 2053335 dated 21.06.1995. The license was issued for import of HPCL Pumps and accessories of Chromatograph at the address of the appellant. The imported goods covered by the said EPCG License were cleared by filing Bill of Entry No. 2610 of 1995 and Bill of Entry No. 2611 of 1995 dated 22.07.1995. The goods were allowed clearance with the benefit of the partial duty exemption under Notification No. 110/95-Cus dated 05.06.1995. The appellant duly discharged its export obligation under the said license. The appellant installed the imported testing equipment at the testing laboratory at their address ‘Near Grid Station, Industrial Area, Odhav, Ahmedabad 382415’. The installation of the imported goods at the testing laboratory was duly certified by the Assistant Commissioner of the Central Excise vide letter dated 09.02.1995.

4.1. Thereafter, the Assistant Commissioner of Customs, Ahmedabad issue