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TMI Blog2016 (9) TMI 618X X X X Extracts X X X X X X X X Extracts X X X X ..... ion notification, whether exemption applicable to the appellant or not. The conditions in the notification for the tolerance limit of nylon yarn have not been fulfilled by the appellant. Any dispute relating to rate of duty, cannot be decided under Section 35G of the Act - appeal not maintainable. Maintainability - appeal pending for a period of 10 years - want of jurisdiction - Held that: - where there is a lack of inherent jurisdiction of the Court, the decree is then said to be a 'nullity'. Just because the case pending for a period of 10 years, it cannot be made maintainable as any judgement made in the lack of jurisdiction will be a nullity anyway - appeal not maintainable. Merits of the case need not be considered - appeal dismissed - decided against appellant. X X X X Extracts X X X X X X X X Extracts X X X X ..... ted 30.03.2000, confirming the demand of ₹ 4,13,79,605/- and denied exemption, under Notification No.08/96 dated 23.07.1996, but without imposing any interest or penalty on the appellant. Aggrieved by the said order, the appellant preferred an appeal before the Commissioner of Central Excise (A), Chennai and that the same was confirmed by the Commissioner of Central Excise (A). Hence, the appellant preferred an appeal before CESTAT, Chennai, by raising the following grounds : i. that in view of the deposition of the Chemical Examiner during the cross examination before the Assistant Commissioner, the test reports cannot be sustained. ii. The test result of any batch is relevant only for the particular batch. iii. Modvat credit for Nylon chips cannot be denied. iv. No duty could be charged in respect of supplies made under deemed exports scheme. v. Re-determination of value of the final product (Nylon Filament Yarn) has to be allowed in the light of decision of Tribunal in Shri Chakra Tyres case and Hon'ble Supreme Court in Maruti Udyog Ltd., case. vi. It is also pointed out that there is duplication of demand, as demands relating to yet another show cause noti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the appellant has not been able to prove that the twine exported is made out of the quantity of yarn produced during the relevant. He, therefore submitted that rejection of the appellant's plea by the Tribunal, without considering the first in and first out method, is incorrect, as per the principles laid down, by the Hon'ble Supreme Court, in the case of TELCO vs. Municipal Commissioner, Thane, reported in (1993) Suppl. (1) SCC 361. Therefore, in the light of the above submissions, he prayed that the substantial questions of law framed by this Court, should be answered in favour of the appellant and that the appeal has to be allowed. 9. Per contra, learned counsel for the 2nd respondent would raise preliminary objections with regard to the maintainability of the instant appeal, in view of the bar under Section 35G of Central Excise Act 1944. Learned counsel further submitted that mere perusal of the substantial questions of law, would clearly show that the appellant has raised questions of law pertaining to the claim of exemption, under the Exemption Notification. However, as per Section 35G of the Act, an appeal to High Court shall lie, provided it is not an order r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion notification. The 4th test report was dated 01.10.1996, where the tenacity and denier test result was to the effect that denier was 224.8. The 5th report however showed a denierage of 212.1. It is the case of the appellant that in the meanwhile they have changed the process, and that therefore, the tenacity / denierage was reduced well within the limits of the exemption notification. It is further stated by the learned counsel for the 2nd respondent that the appellant had admitted that they had not intimated any process change to the department, whereby such reduction of denierage was recorded, when it is the case of the appellant that denierage is based on various factors, including the inputs used by them. It is the submission of the learned counsel for the 2nd respondent that the onus rests entirely, on the applicant to have intimated the department and proved that they have changed the process parameters and that the process resulted in lower tenacity/ denierage within the exemption limits. According to him, the appellant has not intimated the department of this change in the process. In the above circumstances, he contended that the assessee has failed to prove that partic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isely stating therein the substantial question of law involved. (3) Where the High Court is satisfied that a substantial question of law is involved in any case, it shall formulate that question. (4) The appeal shall be heard only on the question so formulated, and the respondents shall, at the hearing of the appeal, be allowed to argue that the case does not involve such question : Provided that nothing in this sub-section shall be deemed to take away or abridge the power of the Court to hear, for reasons to be recorded, the appeal on any other substantial question of law not formulated by it, if it is satisfied that the case involves such question. (5) The High Court shall decide the question of law so formulated and deliver such judgment thereon containing the grounds on which such decision is founded and may award such cost as it deems fit. (6) The High Court may determine any issue which - (a) has not been determined by the Appellate Tribunal; or (b) has been wrongly determined by the Appellate Tribunal, by reason of a decision on such question of law as is referred to in sub-section (1)." 15. Therefore, Section 35G makes it clear that an appeal to High Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to sub-section (5) of Section 129-D, it is proper that the said 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 relating to the rate of duty and to the value of goods for purposes of assessment are questions that squarely fall within the meaning of the said expression. A dispute as to the classification of goods and as to whether or not they are covered by an exemption notification relates directly and proximately to the rate of duty applicable thereto for purposes of assessment. Whether the value of goods for purposes of assessment is required to be increased or decreased is a question that relates directly and proximately to the value of goods for purposes of assessment. The statutory definition of the said expression indicates that it has to be read to limit its application to cases where, for the purposes of assessment, questions arise directly and proximately as to the rate of duty or the value of the goods. 12. This, then, is the test for the purposes of determining whether or not an appeal should be heard by a Special Bench of CEGAT, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tions of law raised for consideration. No costs." 17. The learned counsel for the appellant submitted that the appeal is within the jurisdiction of the Madras High Court, under Section 35G. It is also his submission that the issue in the instant appeal, is not on Classification of Yarn or valuation of yarn or the rate of duty on yarn or the eligibility of the exemption notification for 210d yarn, but is only a challenge to the error committed by the Customs, Excise and Service Tax Appellate Tribunal in applying the 5th test report, which result, is not the same as that of the previous four test reports. Therefore, according to him, the relief sought for, ought to have been granted, by following the decision of the Hon'ble Supreme Court in the case of Tata Engineering & Locomotive Company Ltd. vs. Municipal Corporation of the City of Thane and Other, reported in 1993 Supp (1) SCC 361. Further, he has also contended that the appeal is pending for more than ten years, and at this distance point of time, the stand taken by the respondent department should not be accepted. 18. However, learned counsel for the respondents drew the attention of this Court to the decision of the Hon& ..... X X X X Extracts X X X X X X X X Extracts X X X X
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