2005 (8) TMI 179 - AT - Customs

Summary

Issues Involved:

1. Leviability of Additional Duty of Customs on imported rubber under Section 3 of the Customs Tariff Act, 1975.
2. Whether the cess levied under Section 12 of the Rubber Act, 1947, on rubber produced in India should be considered for imposing additional duty on imported rubber.
3. The impact of non-pressed appeals before the Supreme Court on the Tribunal's jurisdiction and consistency in legal positions.

Issue-wise Detailed Analysis:

1. Leviability of Additional Duty of Customs on Imported Rubber:

The core issue revolves around whether the Additional Duty of Customs under Section 3 of the Customs Tariff Act, 1975, is leviable on imported rubber to an extent equal to the cess levied under Section 12 of the Rubber Act, 1947, on rubber produced in India. The Tribunal recognized that the Additional Duty of Customs is intended to counterbalance the excise duty levied on domestically produced goods to maintain fair competition. The Tribunal referred the matter to the Larger Bench to reconsider the earlier decisions, particularly the MRF Ltd. case, which concluded that the cess demanded under Section 3 of the Tariff Act should not have been levied on imported rubber.

2. Cess Under Section 12 of the Rubber Act, 1947:

The Tribunal examined whether the cess levied on rubber produced in India under Section 12 of the Rubber Act should be considered an excise duty for the purpose of imposing additional duty on imported rubber. The Tribunal noted that the cess under Section 12 is described as a duty of excise, and the Ministry of Commerce clarified that this cess applies only to rubber produced in India. However, the Tribunal highlighted that these clarifications did not address the additional duty under Section 3 of the Customs Tariff Act. The Tribunal expressed doubts about the correctness of the MRF Ltd. decision, which relied on these clarifications to exempt imported rubber from the additional duty.

3. Impact of Non-Pressed Appeals Before the Supreme Court:

The Tribunal addressed the contention that the Revenue, having not pressed appeals before the Supreme Court in similar cases, should not raise contrary contentions in other cases. The Tribunal acknowledged the principle of judicial consistency but emphasized that the dismissal of appeals as not pressed does not constitute a Supreme Court decision on the merits. Therefore, the Tribunal retained the jurisdiction to reconsider its earlier decisions. The Tribunal cited several Supreme Court and Tribunal decisions to support the argument that the Revenue cannot selectively challenge decisions and must maintain consistency in legal positions. However, the Tribunal concluded that the non-pressed appeals did not preclude it from reconsidering the legal issue at hand.

Conclusion:

The Tribunal decided to refer the question of leviability of Additional Duty of Customs on imported rubber to the Larger Bench due to conflicting views in previous decisions and the need for judicial consistency. The Tribunal emphasized the importance of clarity in taxation law and the necessity to resolve the issue to prevent perpetuating potential legal errors. The Registry was directed to obtain necessary orders for placing the appeal before a Larger Bench for a definitive resolution.