1984 (6) TMI 244 - AT - Customs

Issues Involved:
1. Applicability of Notification No. 305/79-C.E., dated 4-12-1979, for countervailing duty.
2. Binding nature of Trade Notices on the department.
3. Estoppel against the government in taxation matters.
4. Alleged discrimination by different Collectorates.
5. Request for stay pending government decision on representation.

Issue-Wise Detailed Analysis:

1. Applicability of Notification No. 305/79-C.E., dated 4-12-1979, for countervailing duty:
The appellants argued that Notification No. 305/79-C.E., dated 4-12-1979, should apply, reducing the countervailing duty (c.v. duty) on caprolactum to 23% ad valorem. However, this notification had specific conditions: caprolactum must be manufactured from benzene derived from raw naphtha with excise duty paid. The appellants did not meet these conditions, leading to the demand for the higher tariff rate of 50% ad valorem. The tribunal upheld the authorities' decision, confirming that the appellants were not entitled to the benefits of the notification due to non-fulfillment of its conditions.

2. Binding nature of Trade Notices on the department:
The appellants relied on Trade Notices issued by various Collectorates, which stated that the countervailing duty would remain unchanged at 25% ad valorem. However, the tribunal noted that Trade Notices do not have statutory effect and cannot alter the meaning of statutory provisions. The tribunal cited judicial decisions, including the Bombay High Court in Union of India v. The Elphinstone Spinning and Weaving Mills Co. Ltd. (1978 E.L.T. 1680), which held that Trade Notices cannot control the plain meaning of a tariff entry. Therefore, the government is not bound by the contents of Trade Notices.

3. Estoppel against the government in taxation matters:
The appellants argued that the government should be estopped from demanding a higher duty based on the Trade Notices. However, the tribunal referenced the Supreme Court decision in Dunlop India v. Union of India (1983-E.L.T.-1566-S.C.), which held that there is no estoppel against a party in taxing matters. The tribunal also cited the Andhra Pradesh High Court decision in Etikoppaka Co-operative Agricultural Society Ltd. v. Union of India (1979 E.L.T. J 533), stating that incorrect interpretations by government officers do not create equitable estoppel against the government.

4. Alleged discrimination by different Collectorates:
The appellants claimed discrimination, as other Collectorates did not raise similar demands. The tribunal rejected this argument, stating that it does not have the authority to declare statutory provisions ultra vires based on alleged discrimination. The tribunal emphasized that it must decide the case based on the law as it stood at the relevant time.

5. Request for stay pending government decision on representation:
The appellants requested a stay on the matter until the government decided on their representation to reduce the additional duty. The tribunal denied this request, stating that it must decide the case based on the law in force at the relevant time. The tribunal upheld the authorities' assessment of the product caprolactum at 50% plus 5% special excise duty, as the appellants did not meet the conditions of Notification No. 305/79-C.E.

Conclusion:
The tribunal found no grounds for interfering with the lower authorities' findings and rejected the appeal, confirming the assessment of countervailing duty at 50% plus 5% special excise duty.

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