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TMI Blog2017 (5) TMI 1324X X X X Extracts X X X X X X X X Extracts X X X X ..... vocate, For the Appellant ShriK. Veerabhadra Reddy, JC (AR), For the Respondent ORDER Per: Sulekha Beevi C.S The appellant is engaged in manufacture of Automotive Tyres / Tubes and other rubber products. They procure indigenously grown natural rubber and also import rubber for use in their manufacturing activities. On production of domestic rubber, cess of ₹ 1.50 per kg isleviable under Section 12 of the Rubber Act, 1947 as duty of excise. The appellants imported rubber under Bills of Entry dated 06.12.2001 and 07.12.2001. On both imports they paid cess/CVD at ₹ 1.50/kg amounting to ₹ 4,50,000/- (B/E dated 06.12.2001) and ₹ 3,00,000/- (B/E dated 07.12.2001). According to appellant, the cess at 1.50/kg is not leviable on imported rubber either as additional Customs duty (CVD) or as cess. Under section 12 of the Rubber Act, 1947, the cess is levied as a duty of excise on all rubber produced in India, and it is to be collected by Rubber Board. Whereas, the additional Customs duty is leviable under Section 3(1) of Customs Tariff Act, 1975. This section authorizes for collection of duty equal to the Excise duty leviable on a like article if p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on imported rubber. The Tribunal relying upon Boards circular dt.22.07.97 and 30.06.97 held that cess is not leviable on imported rubber.In the said Circular it was clarified that under Section 12 of Rubber Act, the Cess is leviable on rubber produced in India and not on imported rubber. It can be easily discerned that the issue was (a) in para 5 above and not (b) 6.2 M.M. Rubber Co. Ltd. Vs CC Chennai Final Order No.2547/98 dt.08.12.98 in Appeal No.C/1187/98. In this case, the Commissioner (Appeals) had held that after earlier circular, Circulars dt.02.09.1997 and 29.9.2007 were issued clarifying on levy of additional duty of customs on imported rubber. The said circulars explained that under Section 3 (1) of the Customs Tariff Act, 1975 when Cess is levied on indigenous goods as duty of excise, Additional duty of customs (CVD) equivalent to such cess is leviable on like goods imported. Later, as per Circular No.75/98 dated 08.10.1998 the Circular dated 30.06.1997 and 22.07.1997 were withdrawn. In view of this subsequent clarification from the Ministry, the Commissioner (Appeals) held that earlier decision of the Tribunal in MRF Ltd. (supra) was not applicable to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I am directed to state the following regarding levy of additional duty of customs equivalent to the amount of cess leviable on indigenously manufactured goods. 2. It has been clarified vide F. No.572/6/97-L.C., dated 22-7-1997 that cess under Rubber Act, 1947 is not leviable on imported rubber since the said Act provides levy of cess only on rubber produced in India and not on imported rubber. This clarification pertains to levy of cess on imported rubber. The issue under consideration vide TRU's letter of even number dated 2-9-1997 is not levy of cess but levy of additional duty of Customs equivalent to the amount of cess wherever such cess is leviable as duty of excise. When cess is levied on goods as duty of excise, then as per Section 3 of the Customs Tariff Act, 1975 additional duty of Customs equivalent of such cess (collected as duty of excise) is leviable on similar imported goods. 3. In view of the above, wherever under an Act, cess is levaible as duty of excise on goods produced/manufactured in India, then on similar imported goods an amount equivalent to the amount of cess leviable is levied as additional duty of Customs. For this purpose, what is required ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Entry in both Order-in-Original they are all dated from 05.07.1995 to 17.09.1998. The period of dispute is before the 08.10.1998. However, the adjudicating authority confirmed the demand holding that the circular dated 08.10.1998 had a retrospective effect and therefore the circulars dated 30.06.1997 and 29.07.1997 are not having effect. Thus he did not follow M.M. Rubber judgment which was based on these circulars of 1997. The same was confirmed by Commissioner (Appeals). In appeal, the Tribunal set aside the demand. 6.5 Meanwhile, the Bangalore Bench in Vikrant Tyres had taken similar view, which was challenged by Revenue before Supreme Court. The Apex Court dismissed the appeal as not pressed. There was also reference of the issue to Larger Bench of Tribunal, which was returned as unanswered. 6.6 The Tribunal in M/s. London Rubber Co. case, to set aside the demand has followed judgments in the case of M.M Rubber Co. Ltd. and Vikrant TyresLtd. and TTK-LIG Ltd . which had been disposed of by different benches of the Tribunal as above. Relevant paragraph of Tribunal's order in London Rubber Co. India Ltd is quoted as under : 7. We have carefully co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as per the order passed by the Apex Court in Vikrant Tyres and M.M .Rubber. The decision of Supreme Court in Vikrant Tyres as reported in 2003 (157) A134 (SC)and 2004 (165) ELT A212 (SC) are reproduced as under : 2003(157) E.L.T. A.134 (SC) Cess not leviable on imported rubber The Supreme Court Bench comprising Hon ble Mr. Justice S.N. Vairava and Hon ble Mr. Justice B.N. Agrawal on 17-2-2003 dismissed as not pressed the Civil Appeal No.D19381 of 2002 filed by Commissioner of Customs, Chennai against the CEGAT Order No.1761/2001, dated 29-11-2001 (Vikrant Tyres Vs. Commissioner) . While dismissing the appeal, the Supreme Court passed the following order:- Learned counsel for the appellant states that she has instructions not to press this appeal. It is dismissed as such. The Appellate Tribunal in its impugned order following the ratio of its earlier decision in the case of TTK Ltd. Vs. Collector [1999 (111 E.L.T. 52] had held that cess under Section 12 of the Rubber Act read with Section 3 of the Customs Tariff Act, 1975 is not leviable on the imported rubber. 2004(165) E.L.T. A212 (SC) Cess not leviable on imported rubber ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not whether cess under Section 12 of the Rubber Act, 1947 is leviable on imported rubber but that the issue was whether cess is leviable on imported rubber under Section 12 of Rubber Act, 1947 read with Section 3 (1) of Customs Tariff Act, 1975; that therefore issue in the present appeal is covered by the judgment rendered by Apex Court in London Rubber Co.India Ltd. 9. To support his contention he has produced copy of the S.L.P filed by Revenue before Apex Court. The Counsel has taken assistance from the copy of the S.L.P for the reason that judgment of the Hon ble Apex Court does not mention about the issue. In the S.L.P., the question of law framed by Revenue reads as under: (a) Whether Cess is leviable on imported rubber under Section 12 of the Rubber Act, 1947 read with Section 3 of the Customs Tariff Act, 1975 (b) Whether the claim of the Respondent for refund of duty is barred by the doctrine of unjust enrichment 10. Together with this, in para-C of the grounds of appeal, the Revenue has stated as under: C. That the Hon ble Tribunal failed to appreciate the provisions of Section 3(1) of the Customs Tariff Act, 1975 which reads as, Any article ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 13. We have perused the judgement in the above Larger Bench decision. As rightly pointed out by Ld. AR, in this judgment authored by then Hon ble President, Shri Justice Abichandani, the difference in the issue in the cases decided by the Tribunal in M.M.Rubber/Vikrant Tyres as well as in the cases referred for decision of Larger Bench has been well discussed and analyzed. The Larger Bench held that additional duty of customs is leviable under Section 3 of Customs Tariff Act, 1975 on imported rubber equal to the duty of excise levied as cess under Section 12 of Rubber Act, 1947, holding the issue in favour of Revenue. 14. Thus we find that the issue posing for consideration in the case before us stands covered by the judgment of the Larger Bench in T.T.K. LIG Ltd. (supra) 15. Argument of ld. Counsel for the appellant that the very same issue was considered in the case of M.M. Rubber and Vikrant Tyres is not correct. It may be true that Larger Bench has not referred to the judgements of London Rubber Co.India Ltd. But at the cost of repetition, it has to be stated that the order impugned in the S.L.P in respect of M/s.London Rubber Co. Ltd . was rendered by Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ex Court and, accordingly, that appeal was dismissed. This would mean that the department has accepted the position that no Cess under Section 12 of the Rubber Act is leviable as Additional Duty of Customs under Section 3 of the Customs Tariff Act in respect of rubber imported into India. We also take judicial notice of the Apex Courts order in Civil Appeal Nos. 1970-1981/2005 in the case of M.M. Rubber Co. v. Commissioner of Customs (Exports), Chennai [2005 (186) E.L.T. A161 (S.C.)]. The said appeals were filed against an order of this Bench holding that Cess leviable under Section 12 of the Rubber Act was not leviable by the department as Additional Duty of Customs under Section 3 of the Customs Tariff Act in respect of imported rubber. Our order, however, had not considered a pending refund claim of the party claiming refund of the amount already collected from them by the department in respect of imported rubber under Section 3 of the Customs Tariff Act. Hence, the Hon ble Supreme Court remanded the matter to us for considering the question whether the refund claim of M/s. M.M. Rubber Company is hit by the bar of unjust enrichment. The Hon ble Supreme Courts order did not dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eal is dismissed on the ground of delay. The Appellate Tribunal vide its impugned order had held that the Apex Court in the cases of Vikrant Tyres Ltd. [2003 (157) E.L.T. A134 (S.C.)] and M.M. Rubber Co. [2005 (186) E.L.T. A161 (S.C.)] had held that cess under Section 12 of Rubber Act, 1947 read with Section 3 of Customs Tariff Act, 1975 was not leviable on imported rubber, therefore the assessee had no liability to pay any duty of the above kind in respect of rubber imported by them however, their refund claim was required to be examined in further details. The Tribunal, therefore, remanded the matter to the original authority to determine whether the claim of the assessee was hit by the bar of unjust enrichment. [Commissioner v. Vikrant Tyres Ltd. - 2010 (254) E.L.T. A69 (S.C.)] 19. The judgment passed by earlier Bench of Chennai in TTK-LIG Ltd. - 2008 (231) E.L.T. 45 (Chennai) was also appealed before the Hon ble Apex Court. The said appeal was dismissed on the ground of monetary limit leaving the issues open as reported in 2012 (277) ELT A85 (SC). The said para is reproduced as under: Cess Rubber - Cess Whether Cess - leviable on imported natu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly under the Rubber Act, 1947 and that the petitioner had not raised any grievance even to have the order rectified on this factual aspect at any point of time to contend that what was levied was additional duty only. I have no hesitation in rejecting the line of reasoning projected by the learned Senior counsel appearing for the petitioner. It is not denied by the learned senior counsel appearing for the petitioner that Section 3(1) of the Customs and Tariff Act, 1975 is a valid piece of legislation and the State has the authority to levy additional duty. 22. We have to stress that the Boards circular dt. 22.07.1997 and 30.06.1997 which was referred to in the earlier Tribunal decision of MRFLtd. and M.M Rubber (supra ) was withdrawn subsequently by the Board vide a circular No..75/98 dt. 08.10.98. In fact, immediately after issue of the said circular dt. 22.07.97 Board had issued circular dt. 2.2.97 and 29.9.97 clarifying that for imported goods equivalent amount of cess leviable as duty of excise has to be collected as additional duty of customs and that even though Rubber Act, 1947 would provide for collection of cess on imports, additional duty of customs is payable on i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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