2020 (5) TMI 610 - HC - Central Excise

Maintainability of appeal - appropriate forum - applicability of notification No.13/2008-CE dated 01.03.2008 amending the notification No.108/95-CE dated 28.05.1995 - Section 35G or 35L of the Central Excise Act? - HELD THAT - A conjoint reading of Section 35G and 35L, it could be seen that an appeal would lie to this Court against every order passed in an appeal by the appellate tribunal, if the case involves a substantial question of law. However, exception to this general rule is that an appeal would lie before the Hon ble Apex Court and not before this Court against an order relating, amongst other things, to the determination of any question having a relation to the rate of duty of excise or to the value of goods for the purposes of assessment. The aforesaid authoritative principles by the Hon ble Apex Court in the case of COMMISSIONER OF CUSTOMS, BANGALORE-1 VERSUS M/S MOTOROLA INDIA LTD. 2019 (9) TMI 229 - SUPREME COURT where it was held that if order of the Appellate Tribunal would go beyond interse disputes between the parties and may effect large number of cases, such an issue would partake the character of one of General public importance . Comparative analysis of Section 35G and 35L of the Central Excise Act would indicate they are mutually exclusive. Therefore, dispute which would be in the domain of Section 35L cannot be held or presumed that it would incidentally fail with domain under Section 35G also. Parliament would not have envisaged of vesting overlapping of the jurisdiction. The dispute does not restrict itself to inter party rights, but extends to class or category of assessees like the respondent herein, inasmuch as, interpretation of the notification dated 01.03.2008 is the subject matter of this appeal. Thus, issue as to whether the said notification would empower the revenue to deny the exemption provided under the notification dated 28.08.1995 is an issue which has to be determined by formulating substantial question of law framed in that regard and same has to be answered - the issue involved relates determination of excercisibility of the goods for the purposes of assessment by virtue of the clarificatory notification dated 01.03.2008. An appeal under Section 35G before this Court would not be maintainable and appellant revenue has to pursue its grievance by filing an appeal under Section 35L before the Hon ble Apex Court - Appeal filed under Section 35G is held to be not maintainable and reserving liberty to the appellant to present this appeal before Hon ble Apex Court under Section 35L - appeal dismissed.

Summary

Issues:
Maintainability of appeal under Section 35G of the Central Excise Act regarding exemption notification.

Analysis:
The judgment revolves around the maintainability of an appeal under Section 35G of the Central Excise Act concerning an exemption notification issue. The respondent argued that the appeal should be filed before the Supreme Court under Section 35L due to the substantial question of law regarding the applicability of a notification. The appellant contended that since the issue pertained to the entitlement of the respondent to claim exemption based on the notification, the appeal before the High Court was appropriate. The court considered various authorities and highlighted the importance of the issue in question.

The court referred to a previous decision by the Supreme Court in the case of COMMISSIONER OF CUSTOMS, BANGALORE vs. MOTOROLA INDIA LTD., which clarified the scope of appeals under Section 35G and Section 130 of the Customs Act. The judgment emphasized the need for a substantial question of law to be present for an appeal to be entertained by the High Court. The court also discussed the insertion of sub-section (2) in Section 35L by the Finance Act, 2015, which clarified the purpose of the chapter relating to appeals under the Act by aggrieved parties.

The judgment highlighted that appeals under Section 35G are allowed if they involve substantial questions of law, except for issues related to the determination of duty rates or goods' valuation for assessment purposes. The court reiterated that cases involving such determinations should be appealed directly to the Supreme Court. The judgment further elaborated on the types of cases that warrant special treatment, such as those related to duty rates, goods' valuation, classification, or exemption notifications.

In the specific case at hand, the court analyzed the facts concerning the respondent's acquisition of hydraulic excavators under an exemption notification. The revenue alleged misuse of the exemption due to the relocation of the excavators after project completion. The court noted that the dispute extended beyond inter-party rights and affected a category of assessees. The interpretation of a clarificatory notification dated 01.03.2008 was crucial to determine the excisability of the goods for assessment purposes. Therefore, the court concluded that the appeal under Section 35G was not maintainable, and the revenue should pursue the matter by filing an appeal under Section 35L before the Supreme Court.

In the final order, the court held the appeal under Section 35G as not maintainable, allowing the appellant to present the appeal before the Supreme Court under Section 35L. The registry was directed to return the certified copy of the CESTAT's order and replace it with a photocopy.

This detailed analysis of the judgment provides a comprehensive understanding of the legal issues involved and the court's reasoning behind its decision regarding the maintainability of the appeal under the Central Excise Act.