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TMI Blog2017 (5) TMI 1440X X X X Extracts X X X X X X X X Extracts X X X X ..... ease or decrease in rates of SAD is not by itself a reason to declare the fixation of the rate of duty as unreasonable or illegal. The Court is not satisfied that in the impugned notification can be said to be arbitrary or irrational or that it has been issued by the government without taking into account all the relevant factors. Consequently, the Court is not inclined to interfere with the impugned notification dated 1st March 2002 which in any event has been superseded by the N/N. 23/2003-Cus dated 1st March 2003. Petition dismissed - decided against petitioner. X X X X Extracts X X X X X X X X Extracts X X X X ..... nything contained in Section 14 of the Customs Act, 1962 or Section 3 of this Act, be the aggregate of - (i) the value of the imported article determined under subsection (1) of Section 14 of the Customs Act, 1962 (52 of 1962) or the tariff value of such article fixed under sub-section (2) of that section, as the case may be; (ii) any duty of customs chargeable on that article under Section 12 of the Customs Act, 1962 (52 of 1962), and any sum chargeable on that article under any law for the time being in force as an addition to, and in the same manner as, a duty of customs, but not including the special additional duty referred to in sub-section (1) and (iii) the additional duty of customs chargeable on that article under Section 3 of this Act. (3) The duty chargeable under this Section shall be in addition to any other duty imposed, under this Act or under any other law for the time being in force. (4) The provisions of the Customs Act, 1962 (52 of 1962), and the rules and regulations made thereunder, including those relating to refunds and exemptions from duties shall, so far as they may be, apply to the duty chargeable under this Section as they apply in relation to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orted by passengers or other nominated agencies and life saving drugs that are free from customs duties. The levy would also not apply to goods which are currently exempt both from basic and additional duties of customs. Similarly, goods imported for subsequent trading have also been left out of its purview, since they bear the burden of sales tax at the time of first sale. The new levy will also not apply to inputs imported under export promotion schemes. In addition, there may be other sectors eligible for exemptions. These would be examined and if considered appropriate notified separately. 122. The gradual reduction of import duties in the past few years has resulted in certain distortions and anomalies. My proposals seek to correct them as far as found feasible without causing abrupt disruption in the duty structure." 5. Accordingly, it is submitted by the Petitioner that the intent and purpose of SAD was "to afford a level playing field for indigenous manufacturers of goods which were also imported from outside, to protect the indigenous industry." It is pointed out that the various notifications were issued specifying rates or exempting certain goods/categories of goo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Customs Tariff Act, 1975 (51 of 1975) (hereinafter referred to as the said Act), and in supersession of the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 19/2001-Customs, dated the 1st March, 2001 [G.5.R. 118(E) dated the 1st March, 2001], the Central Government, having regard to the maximum sales tax, local tax or any other charges for the time being leviable on the like goods on their sale or purchase in India, hereby specifies the rates of special additional duty as indicated in column (4) of the Table below in respect of goods, when imported into India, specified corresponding entry in column (3) of the said Table and falling within the Chapter, heading or sub-heading of the First Schedule to the said Act as are specified in the corresponding entry in column (2) of the said Table: Provided that in respect of the goods specified against S. Nos. 38, 39, 40, 56 and 57 of the said Table, "Nil" rate shall be subject to the conditions, if any, subject to which the goods are exempt either partially or wholly from the duty of customs leviable thereon which is specified in the said Act. S.No. Chapter or heading No. or s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as 'nil' has been subjected to SAD @ 4% ad valorem. Mr. Tiku further submitted that the statutory power under Section 3 A CTA has to be exercised in accordance with the conditions stipulated therein. In other words, it is submitted that in deciding the make sulphur and rock phosphate amenable to 4% SAD, the Respondent had to strictly abide by Section 3A (1) of the CAT. In terms thereof, SAD had to be levied "having regard to the maximum sales tax, local tax or any other charges for the time being leviable on a like article on its sale or purchase in India." This according to Mr. Tiku was not done by the Respondents and therefore the impugned notification was bad in law. He referred to the decision of the Supreme Court in Babu Verghese v. Bar Council of Kerala (1999) 3 SCC 422. Submissions of counsel for the Respondents 12. In reply, Mr. Sanjeev Narula, learned Senior standing counsel appearing for Respondent No. 2, at the outset pointed out that the impugned notification was in force only for one year. The position that obtained prior to the issuance of the impugned notification was restored by the subsequent notification No. 29/2003-Cus dated 1st March 2003. Thus both sulphur a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of SAD in exercise of its power under Section 3A of the CTA. It has to keep in view the maximum sales tax, local tax and "any other charge for the time being leviable on a like article on its sale or purchase in India." It is to be interpreted purposively given the context in which the phrase "other charges" occurs. That expression cannot be confined to only charges that are similar to sales tax and local tax. To apply the rule of ejusdem generis to interpret the said expression would unnecessarily and unduly narrow the scope of the expression. In the considered view of the Court such a narrow reading of the expression 'other charges' is not warranted by reading Section 3A as a whole. 17. Sub-section (2) of Section 3A of the CTA states that for the purposes of SAD, the value of the imported article shall be the aggregate of (i) the value of the imported article; the customs duty chargeable and any sum chargeable thereon in the same manner as customs duty but does not include countervailing duty, safeguard duty, anti-dumping duty, the SAD etc. In this context, the word 'having regard to cannot possibly have a restricted meaning. Likewise, the phrase 'any other charges for ..... 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