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TMI Blog2011 (4) TMI 1014X X X X Extracts X X X X X X X X Extracts X X X X ..... amod, Advocate, for the Appellant. Shri K.S. Ravishankar, Advocate, for the Respondent. [Judgment per : N. Kumar, J.]. This appeal is by the Revenue challenging the order passed by the CESTAT [2006 (205) E.L.T. 1069 (Tribunal)] holding that the assessee is entitled to the benefit of DEEC Scheme in terms of Notification No. 30/97-Cus., dated 1-4-1997 read with para 7.4. of the EXIM policy 1997-2002 and as such he is not liable to pay any customs duty. 2. The assessee is a leading manufacturer of pagers. A specific intelligence received by the Directorate of Revenue Intelligence to the effect that the respondent had stopped manufacturing of pagers and hence a certain portion of the duty-free material imported under DEEC Scheme (with Actual User Condition) had been written off in their books of accounts. As the goods imported under Actual User Condition should only be used for manufacturing of the declared final product as no more manufacturing is being done, the officers of the DRI took up further investigation in the matter. The assessee was called upon to submit the list of such unutilised items which are imported under Customs Notification No. 30/97-Cus., dated 1-4 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Notification has been violated. The authorities must be aware of the fact that in the Electronic and Communication Industry, there is rapid advancement and obsolescence is very fast. A component in few months time may be rendered obsolete. It will have no further use at all. In such a changing scenario of technology, there are compulsions to write off certain components which have been imported. Viewed in this angle, it cannot be said there is deliberate violation of the condition of the Notification. In the circumstances like these, when the export obligation is completely fulfilled, the assessee should be deemed to have been fulfilled the conditions of the notification. The case would be different if the appellants had not fulfilled the export obligations. Therefore, the Tribunal set aside the order passed in original and set aside the demand. It also set aside the consequential order of penalty. Aggrieved by the said order, the Revenue is in appeal. 5. This appeal is preferred u/s. 130 of the Customs Act, for short hereinafter referred to as the Act . The appeal was admitted on 20-6-2007 to consider the three substantial questions of law as set out in the order sheet. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ification and whether for non-compliance of the terms of the notification and the licensing conditions the assessee rendered himself ineligible for exemption under the notification. Whether such a question falls within the phrase determination of any question having a relation to the rate of duty of customs or to the value of goods for the purposes of assessment ? 9. Unless the maintainability of the appeal is decided one way or the other, the question of going into the merits of the appeal does not arise. Therefore, the preliminary point that arise for consideration in this appeal is as under : whether the appeal preferred by the Revenue against the impugned order is maintainable u/s. 130 of the Act before the High Court . 10. In order to appreciate this contention it is necessary to look into the appeal provisions as contained in Section 130 as well as Section 130E of the Act which reads as under :- 130. Appeal to High Court (1) An appeal shall lie to the High Court from every order passed in appeal by the Appellate Tribunal on or after the day of July, 2003 (not being on order relating, among other things, to the determination of any question having a relation to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sessment relates to the determination of the rate of duty; (2) The question relates to the determination of the value of the goods. Any question relating to or in relation to these two aspects alone, the High Court has no jurisdiction and in respect of other things it has jurisdiction. 12. In order to appreciate this contention, we have to carefully see the wordings employed by the legislature. The relevant words are as under :- Not being an order relating, among other things, to the determination of any question having a relation to the rate of duty of customs or to the value of goods for the purposes of assessment . The key word in the said provision is for the purpose of assessment . That means the order referred to therein is an order passed in the course of assessment. Therefore, ail orders passed in the course of assessment involving the determination of any question having a relation to the rate of duty of customs or to the value of goods, cannot be the subject matter of appeal before the High Court. By the use of the word among other things it is made clear, even order which may not be directly related to the rate of duty or the value of goods, however wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment as used in Section 7 of the Taxation Laws Act, it should be given its plain meaning. It should not be understood in any restricted or special sense in which it may have been used in the Indian Income-tax Act in a particular context. 16. The Apex Court in the case of Income Tax Officer, Bangalore v. K.N. Guruswamy [1958 ITR Vol. 34 601] explaining the meaning of the word assessment arising under the Income Tax Act has held as under :- Total income means the total amount of income, profits and gains computed in the manner laid down in the Act, and there are no good reasons why the word assessment occurring in the saving provisions should be restricted in the manner suggested so as to exclude proceedings for assessment of escaped income or under-assessed income...........In its normal sense, to assess means to fix the amount of tax or to determine such amount . The process of re-assessment is to the same purpose and is included in the connotation of the term assessment . The reasons which led us to give a comprehensive meaning to the word assessment in section 13(1) of the Finance Act, 1950, operate equally with regard to the saving provisions under present c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Chand and Others, reported in AIR 1963 Supreme Court 677 (V 50 C 104), it is held as under :- 10. The expression determination in the context in which it occurs in Art. 136 signifies an effective expression of opinion which ends a controversy or a dispute by some authority to whom it is submitted under a valid law for disposal. The expression order must have also a similar meaning, except that it need not operate to end the dispute. Determination or order must be judicial or quasi judicial : purely administrative or executive direction is not contemplated to be made the subject-matter of appeal to this Court. The essence of the authority of this Court being Judicial, this Court does not exercise administrative or executive powers i.e. character of the power conferred upon this Court original or appellate, by its constitution being judicial, the determination or order sought to be appealed from must have the character of a judicial adjudication. Goods : 19. Yet another word which also assumes importance is the meaning of the word Goods . In the case of Union of India and Another v. Delhi Cloth and General Mills Co. Ltd. and Others reported in AIR 1963 SC 791 = 1977 (1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted not because an article is covered in any of the items or it falls in residuary category but it must further have been produced or manufactured and it is capable of being bought and sold. 23. The Apex Court in the case of Moti Laminates Pvt. Ltd. v. Collector of Central Ex., Ahmedabad reported in 1995 (76) E.L.T. 241 (S.C.) interpreting Section 3 of the Central Excise and Salt Act, 1944 has held as under : Section 3 levies duty on all excisable goods mentioned in the schedule, provided, they are produced or manufactured. Therefore, when the goods are specified in the schedule, they are excisable goods, but whether the said goods can be subjected to duty depends on whether they are produced or manufactured by the person on whom duty is sought to be levied. The expression production or manufacture has further been explained by this Court to mean that the goods so produced must satisfy the test of marketability. Consequently, it is always open to the assessee to prove that even though goods in which he was carrying on business were excisable goods being mentioned in the schedule, but they could not be subjected to duty as they were not goods either because they were not produ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ustoms on any goods is nil, whether the said goods are or are not covered under a particular notification, or order issued by the Central Government or the Board, as the case may be, granting total or partial exemption from duty and whether the value of any goods for the purpose of assessment of duty of customs shall be enhanced or reduced by addition or reduction of the amounts in respect of such matters as are specifically provided under the Act. Though the determination of the word rate of duty may not include all those questions, the explanation makes it clear the aforesaid expanded meaning is to be attributed to the aforesaid phrase for the purpose of this section only. It is because the said explanation is added to Section 129D which deals with the power of revision of Board or Commissioner of Central Excise in certain case. In other words what is sought to be conveyed by the explanation is that the authorities while exercising the revisional jurisdiction shall not go into those questions. That in no way comes in the way of understanding the meaning of the phrases rate of duty . On the contrary it clearly sets out the intention of the legislature in so far as the meaning t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te relationship to the rate of duty and to the value of goods for the purpose of assessment. Further at para 11 they held as under : It will be seen that sub-section (5) uses the said expression determination of any question having a relation to the rate of duty or to the value of goods for the purpose of assessment, and the Explanation thereto provides a definition of it for the purposes of this sub-section . The Explanation says that the expression includes the determination of a question relating to the rate of duty, to the value of goods for the purposes of assessment; to the classification of goods under the Tariff and whether or not they are covered by an exemption notification; and whether the value of goods for the purposes of assessment should be enhanced or reduced having regard to certain matters that the said Act provides for. Although this Explanation expressly confines the said definition of the said expression to sub-section (5) of Section 129D, it is proper that the expression used in the other parts of the said Act should be interpreted similarly. The statutory definition accords with the meaning we have given to the said expression above. Questions relati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Aggrieved by the said order of the Tribunal, the revenue preferred an appeal directly to the Supreme Court under Section 130E of the Act. 28. In the case of Commissioner of Customs, New Delhi v. Punjab Stainless Steel Industries, reported in 2001 (132) E.L.T. 10 (S.C.), the allegation against the assessee was that the goods exported under the export obligation were mis-declared. In as much as he used the material of inferior grade to the one required in the manufacture of utensils. The said charge was held to be proved on the basis of the report of the expert and therefore the goods were confiscated. The said order was challenged by the assessee before the Tribunal. The Tribunal set aside the said order. Aggrieved by the same, the revenue preferred an appeal directly under Section 130E of the Act before the Supreme Court and the Supreme Court set aside the order of the Tribunal and restored the order of the Commissioner of Customs. 29. In the case of Jindal Dye Intermediate Limited v. Collector of Customs, Mumbai, reported in 2006 (197) E.L.T. 471 (S.C.) the Tribunal had upheld the order of the authorities and denied the exemptions. The assessee preferred an appeal under Sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the principle laid down in the said case squarely apply to the facts of this case, where question involved as stated earlier, was whether fish includes Molluscs and Crustaceans and as such the Crustaceans would otherwise mean and include prawns/shrimps and hence Prawns and Shrimps should be regarded as a fish for the purpose of assessment and such meaning should be given to the expression fish Incorporated as Item No. 7 to the Schedule to the Act. 32. In the case of Commissioner of Customs, New Delhi v. Sony India Limited, reported in 2008 (231) E.L.T. 385 (S.C.), the question involved was whether the assessee had committed breach of Exim Policy. Ultimately, the Tribunal held that there is no breach of Exim Policy and consequently, no duty was paid. The revenue aggrieved by the said judgment preferred an appeal to the Supreme Court under Section 130E of the Act. The Supreme Court upheld the order of the Tribunal. 33. The Supreme Court had an occasion to consider the meaning of the word rate in Sundaram and Company (Private) Limited v. Commissioner of Income Tax, Madras [1967 VOL. 66 ITR 604] where it was held as under :- The assumption that the expression rate ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2009 (13) S.T.R. 498 (Bom.) at para 6 held as under : We have considered the rival contentions made on behalf of parties and also perused the provisions of Sections 35G and 35L(b) of the Act of 1944, an appeal against the order passed by the Appellate Tribunal would lie to the High Court except an order relating, among 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 purposes of assessment. Section 35L(b) provides that an appeal against an order passed by the Appellate Tribunal relating among 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 purposes of assessment would lie to the Supreme Court. It is, thus, clear from the aforesaid proviso that an appeal against an order passed by the Appellate Tribunal relating, among 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 purposes of assessment would lie to the Supreme Court and not the High Court. 37. The Apex Court in the case of I.T.C. Ltd. v. Collector of Central Excise, Patna reported in 1997 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was paid. The revenue aggrieved by the said judgment preferred an appeal to the Supreme Court under Section 130E of the Act. The Supreme Court upheld the order of the Tribunal. Conclusion 40. Therefore, the expression rate is often used in the sense of a standard or measure. Rate generally is an impost, usually for current or recurrent expenditure, spread over a district or other local area and is distinct from an amount payable for work done upon or in respect of particular premises. Rate is defined by Webster to be the price or amount stated or fixed for anything. The word rate includes any toll, due, rent, rate or charge. It means the scale or amount of any other charges. The word rate is used with reference both to a percentage or proportion of taxes, and to a valuation of property. Rate is used in an Act declaring that the Legislative Assembly shall provide by law for a uniform and equal rate of taxation and assessment, applies to the percentage of fixation, as used in connection with taxation and to the valuation of the property, as used in connection with assessment . It is a valuation of every man s estate or setting down how every one shall pay, or be c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ollowing disputes do not fall within the jurisdiction of High Court under Section 130 of the Act :- (a) Dispute relating to the duty of customs payable on any goods. (b) The value of the goods for the purposes of assessment. (c) A dispute as to the classification of goods. (d) Whether those goods are covered by an exemption notification or not. (e) Whether the value of goods for the purposes of assessment is required to be increased or decreased. (f) Whether what is imported or exported is goods which attracts customs duty. 42. From the aforesaid discussion, it is clear that an order passed by the Appellate Tribunal relating to the determination of any question having relation to the rate of duty of customs or to the value of goods for the purposes of assessment lies to the Supreme Court under Section 130 of the Act and not to the High Court under Section 130. 43. The intention behind this bifurcation of jurisdiction between the Apex Court and the High Court seems to be that more often than not, any decision on these aforesaid aspects not only affects the interest of the manufacturers who are parties thereto, but also to the manufacturers of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he time of admission, this Court is called upon to decide whether the terms and conditions of the notification No. 30/09-Cus., dated 10-4-1997 has been complied with by the assessee or not and whether the levy of duty interest and penalty is legal or not and whether the Tribunal was justified in setting aside the levy of duty, interest and penalty? 46. All these questions relate to determination of rate of duty payable, entitlement of exemption under notification. They have to be decided by the Apex Court in an appeal to be preferred under Section 130-E and not by the High Court in an appeal preferred under Section 130 of the Act. Therefore the learned Counsel for the assessee is justified in contending that this appeal preferred by the Revenue challenging the order passed by the Appellate Tribunal holding that the assessee is not liable to pay Customs duty, interest and penalty and setting aside the levy of duty and demand notice issued by the Department is not maintainable before this Court. 47. Therefore, we are of the considered opinion that the present appeal preferred under Section 130 of the Act is not maintainable before this Court. The appeal is to be preferred to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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