2016 (6) TMI 814 - HC - Customs

Rate of duty on import of crude degummed soyabean oil of edible grade - when a notification comes in effect - Scope of section 25 - The petitioners claim that a notification that had not become effective on the relevant date has been arbitrarily cited by the Customs authorities to demand duty at a much higher rate than payable by the petitioning assessee. Held that - The most cardinal rule in interpreting a statutory provision is that the language of the statute should be read as it is. If the language of Section 25(4) of the Act is not distorted and the intention thereof gathered from the language used therein the plain meaning of the words used do not admit of a construction that unless a notification is published in the Official Gazette and unless such notification or the Official Gazette containing the same is put on sale the notification is not deemed to come into force. The construction of the provision as the petitioners suggest would require the addition or substitution of words not found in the provision or the rejection of certain words as meaningless. It is elementary that if a provision in a statute can be read without adding words thereto or subtracting words therefrom that would be the ideal construction unless it throws up an absurd result. The literal construction in this case does not result in any absurdity. The fallacy in the petitioners argument is that it is founded on the responses received following the queries raised under the Act of 2005. The queries and the responses received are on the mistaken premise that it is the notification as published in the Official Gazette that must be put on sale. The wording of the relevant sub-section does not warrant such a construction. Both clauses of such sub-section would be complied with if a notification were to be issued for publication in the Official Gazette and such notification were to be simultaneously put up on the website and otherwise offered for sale though the timing of the issuance of the notification may have resulted in the publication in the Official Gazette to be made a day later. As long as the publication of a relevant notification is made in the Official Gazette whether within reasonable time or at the first available opportunity of such notification being issued for publication therein the notification comes into effect immediately upon its issuance for publication in the Official Gazette notwithstanding the publication in the Official Gazette being later. There is no dispute that the notification was issued on the date it is said to have been. There is no dispute that the notification was issued for publication in the Official Gazette on the same day. There is even no dispute that the Official Gazette containing the said notification was published on the same day. All the that the petitioners have been able to demonstrate is that the Official Gazette containing the said notification may not have been put up for sale prior to September 21 2015. But that is of no consequence. The notification came into force on the date of its issue for publication in the Official Gazette and such date indisputably was September 17 2015. Even if a strict view of the matter is taken and the publication in the Official Gazette is seen to be a precondition to the coming into force of the said notification that was also completed on September 17 2015. If the Union s assertion of copies of the notification being put up for sale on September 17 2015 is disbelieved at the highest it would amount to non-compliance of clause (b) which would have no effect on when the notification came into force. The petition is dismissed with the observation that the liability of the petitioning assessee to pay the duty as per the notification of September 17 2015 is unimpeachable. It is the higher rate of duty under the notification that the petitioning assessee is liable to pay. - Decided against the petitioners.

Issues Involved:
1. Applicability of Notification No. 46/2015-Customs.
2. Effective date of the notification.
3. Interpretation of Section 25(1) and Section 25(4) of the Customs Act, 1962.
4. Compliance with the conditions under Section 25(4) for the notification to come into force.
5. Legal precedents and their applicability to the case.

Issue-wise Detailed Analysis:

1. Applicability of Notification No. 46/2015-Customs:
The petitioners contended that the notification dated September 17, 2015, which increased the duty on crude degummed soybean oil from 7.5% to 12.5%, had not become effective by the time the goods were imported. They argued that the notification was cited arbitrarily by Customs authorities to demand a higher duty.

2. Effective Date of the Notification:
The petitioners argued that the notification did not become effective until it was published in the Official Gazette and offered for sale. They relied on replies received under the Right to Information Act, 2005, which indicated that the notification was received and put on sale on September 21, 2015. They maintained that the previous rate of 7.5% should apply as of September 17, 2015, the date for determining duty and tariff valuation under Section 15 of the Customs Act.

3. Interpretation of Section 25(1) and Section 25(4) of the Customs Act, 1962:
The petitioners emphasized that Section 25(1) mandates that any notification must be published in the Official Gazette to be effective. They argued that both conditions under Section 25(4)-publication in the Official Gazette and offering for sale-must be met for the notification to come into force. They cited legal principles and precedents to support their interpretation.

4. Compliance with the Conditions under Section 25(4) for the Notification to Come into Force:
The court analyzed Section 25(4) and concluded that the notification comes into force on the date it is issued for publication in the Official Gazette, as per clause (a). Clause (b), which requires the notification to be published and offered for sale, is a separate statutory command. The court held that the notification would be effective upon its issuance for publication, even if the actual publication and sale occurred later.

5. Legal Precedents and Their Applicability to the Case:
The petitioners referred to the Supreme Court judgment in Param Industries Limited, which interpreted Section 25(4) to mean that both conditions must be met for a notification to be effective. However, the court distinguished this case, noting that the Supreme Court's decision did not specifically address Section 25 of the Customs Act. The court also referred to the judgment in Ganesh Das Bhojraj, which held that a notification becomes effective upon its publication in the Official Gazette without further requirements.

Conclusion:
The court dismissed the petition, holding that the notification dated September 17, 2015, became effective on the date it was issued for publication in the Official Gazette. The petitioners were liable to pay the higher duty of 12.5% as per the notification. The court emphasized that the statutory language of Section 25(4) should be interpreted as written, without adding or subtracting words. The failure to offer the notification for sale on the same day did not affect its validity or effective date. The petitioners' liability to pay the enhanced duty was upheld.

Order:
The petition was dismissed, and the petitioning assessee was held liable to pay the duty as per the notification of September 17, 2015. No order as to costs was made. Urgent certified website copies of the judgment were allowed to be supplied to the parties subject to compliance with requisite formalities.

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