2000 (12) TMI 114 - HC - Customs

Summary

Issues Involved:
1. Constitutionality of Condition No. 4B(ii) of Notification No. 88/2000.
2. Alleged Violation of Articles 14 and 19(1)(g) of the Constitution of India.
3. Public Interest and the Power of the Central Government under Section 25 of the Customs Act.

Issue-wise Detailed Analysis:

1. Constitutionality of Condition No. 4B(ii) of Notification No. 88/2000:
The petitioner challenged the constitutionality of Condition No. 4B(ii) of Notification No. 88/2000, which required manufacturers to have a captive hydrogen generation facility to avail the concessional duty on crude palm oil. The petitioner argued that this condition was arbitrary and unconstitutional. The respondent countered that the condition was imposed to prevent misuse of the concession and to ensure that crude palm oil was used for manufacturing Vanaspathi, not sold directly in the market.

2. Alleged Violation of Articles 14 and 19(1)(g) of the Constitution of India:
The petitioner claimed that the condition violated Article 14 (Right to Equality) and Article 19(1)(g) (Right to Practice Any Profession or to Carry on Any Occupation, Trade, or Business) of the Constitution. The petitioner argued that the classification between manufacturers with and without captive hydrogen generation facilities was discriminatory and lacked a rational nexus to the objective of the concession. The respondent maintained that the condition was in the public interest to prevent the misuse of the concessional duty and was not discriminatory.

3. Public Interest and the Power of the Central Government under Section 25 of the Customs Act:
The court noted that Section 25 of the Customs Act empowers the Central Government to grant exemptions from customs duty in the public interest, either absolutely or subject to conditions. The court emphasized that the power to grant exemptions includes the power to modify or withdraw them. The court found that the condition imposed by Notification No. 88/2000 was based on practical experience and aimed at preventing the misuse of the concessional duty, thereby serving the public interest.

Judgment:
The court held that the condition imposed by Notification No. 88/2000 was constitutional and in the public interest. The court found that the classification between manufacturers with and without captive hydrogen generation facilities was rational and aimed at preventing the misuse of the concessional duty. The court dismissed the writ petition, stating that the petitioner failed to prove that the condition was against the public interest or violated Articles 14 and 19(1)(g) of the Constitution. The court also emphasized that the burden of proving discrimination under Article 14 lies heavily on the petitioner, which was not met in this case.

Conclusion:
The writ petition was dismissed, and the court upheld the constitutionality of Condition No. 4B(ii) of Notification No. 88/2000, finding it to be in the public interest and not violative of Articles 14 and 19(1)(g) of the Constitution. The court reiterated the Central Government's power to impose conditions on exemptions under Section 25 of the Customs Act in the public interest.