2010 (3) TMI 236 - HC - Customs

Cess- Whether Cess levied under section 5 of Textile Committees Act, 1963 is includable as a component of CVD? Held that- case exemption from payment of cess was not available to the appellant for want of specific notification in that behalf. No material is placed before us to infer that the cess leviable under the Textile Committees Act was component of CVD. So far as reliance placed by the appellant on the case of Moray Brembana Ltd. 2003 (2) TMI 100 - CEGAT, MUMBAI is concerned, the same is misplaced. In the facts of that case, the element of cess may have been included in the CVD but in the case in hand no such material is produced before us to take view in consonance with the view taken by the Tribunal in the case of Morarjee Brembana Ltd. In the result, the question raised is answered in negative i.e. in favour of the Revenue and against the Assessee. Appeal is dismissed with no order as to costs.

Summary

Issues:
1. Interpretation of whether Cess levied under section 5 of Textile Committees Act, 1963 is includable as a component of CVD.

Analysis:
Question of Law:
The appeal questioned whether Cess under the Textile Committees Act, 1963 is part of CVD. The appellant, a yarn manufacturer, imported machinery claiming duty exemption. The Assistant Commissioner demanded Cess payment, which the appellant contested, arguing it was part of excise duty. The Commissioner of Customs (Appeals) ruled in favor of the appellant, but the Tribunal overturned this decision, stating Cess was applicable even if CVD was nil. The appellant appealed to the High Court, citing a Tribunal judgment equating Cess with CVD. The Revenue argued that Cess is under separate legislation and not exempted unless specified. They cited a Supreme Court case and a Tribunal decision supporting this stance.

Consideration:
The High Court analyzed the Notification No. 110/95-Cus. exempting customs duty but not mentioning Cess. Referring to the Supreme Court's ruling, the Court held that specific notifications are required for Cess exemption. Without evidence that Cess is part of CVD, the Court rejected the appellant's argument based on a different case. Ultimately, the Court ruled against the appellant, stating Cess payment was necessary. The appeal was dismissed, with no costs awarded.

This detailed analysis of the judgment showcases the legal arguments, interpretations, and conclusions reached by the High Court in this case regarding the inclusion of Cess under the Textile Committees Act, 1963 as a component of CVD.