Representations have been received to the effect that consequent to Board's letter of even number date 26.8.96 wherein it was mentioned that the benefit on notification No. 1/ 95-CE dated 4.1.95 cannot be extended to goods, inter - alia, air-conditioners used for maintenance/ repair of machinery, computer, etc., field formations are not allowing the benefit of the said notification even to those cases where such air-conditioners are required and essential for the manufacture or production of goods by a 100% EOU/ EHTP/ STP unit. It has been stated that air -conditioners in these cases can be covered under the description 'Capital Goods' specified in the aforesaid notification.
 

        The matter has been examined by the Board.

        On the similar issue, the Customs Wing has issued a Circular No. 57/96' dated 29.11.96 from F.No. 305/ 90/ 94-FTT (Copy enclosed)¹ wherein it has been clarified that wherever air-conditioners are required and necessary for the manufacture or production of goods by 100% EOU/EHTP/STP Units in EPZ, they will be treated as Capital Goods and allowed duty free clearance under the relevant notifications issued in this regard.

        It has been decided by the Board that the instructions contained in aforesaid Customs Circular should be applied, mutatis mutandis, to notification No. 1/95-CE dated 4.1.95. Accordingly, Board's letter of even no. dated 26.8.96 is modified to this extent.