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TMI Blog2024 (1) TMI 902X X X X Extracts X X X X X X X X Extracts X X X X ..... part of the legal provisions are to be taken together and each word, phrase or sentence is to be considered in the light of the general purpose and object of the Act itself. It is abundantly clear from the title and scope of Section 28AA of the Act, that interest is applicable on duty levied under Section 3 of the Tariff Act, as it is held to be a duty of customs within the meaning of Section 2(15) of the Act and further reinforced by the non-obstante opening of the sub-section, that reemphasised that interest is unquestionably leviable for the delayed payment of duty. Section 3 of the Tariff Act (including its subsection 8) interpreted on its own language or along with Section 28AA of Act are not ambiguous. The mischief, if any ought to be suppressed with the aid of internal tools like the non-obstante phraseology or the text and the head note of the sections, besides giving the words used in law their ordinary meaning. The apex court in the case of Doypack Systems (Pvt.) Ltd. Vs. UOI, [ 1988 (2) TMI 61 - SUPREME COURT ] observed that words used in the statute must prima facie, be given their ordinary meaning and where the grammatical construct is clear and manifest, wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... settlement of case a variation/deviation from the applicability of routine structural legal process. Thus, those decisions would be irrelevant for deciding the issue in the present matter concerned with the liability to pay interest in terms of the statutory provision of the Customs Act as rendered applicable to the Tariff Act (Section 3). In view of Section 3 of the Tariff Act read with Section 12 of the Customs Act, the special additional duty is to be construed as Customs Duty and therefore in view of the provisions of the law, all the provisions of the Customs Act and Rules/Regulations made thereunder are squarely applicable to the issue at hand. Further, it is common knowledge that taxation does not concern principles of equity. If the appellants have failed in discharge of their statutory obligations or have been deficient thereto, consequences, advantages and disadvantages thereof shall follow. It is not open for the appellants to have the best of both ends. There are no infirmity in the order of the lower authority under challenge, as the same is in accordance with law - The appeal filed by the appellants is therefore liable to be dismissed - appeal dismissed. - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... into India effective since 17.03.2012 was as under: Duty of Customs (Head wise) Rate of duty leviable/payable Basic Customs Duty(BCD) (Section 12-Customs Act, 1962) 10% Additional Duty of Customs/Counter vailling Duty (CVD) (Section 3-Customs Tariff Act, 1975) 12% Education Cess on Aggregate Customs Duty (Finance Act, 2004) 2% Secondary Higher Education Cess on Aggregate Customs Duty (Finance Act, 2007) 1% Special Additional Duty (Section 3A-Customs Tariff Act, 1975) 4% 2.1. The department submits that Notification No. 18/2012 (C.E.) dated 17.03.2012 was rescinded on 30.05.2012 after the Finance Act, 2012 was assented to by the President of Bharat on 28.05.2012. Further, the tariff rate of Central Excise Duty on goods falling under CTH 8607 was 12% ad valorem w.e.f. 28.05.2012 as per Sl. No.73(b) of the Seventh Schedule of the Finance Act, 2012. The relevant portion of the Seventh Schedule of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AA of the Customs Act. 7.8. Issue Involved: The appellant is not contesting the payment of differential duty at this stage. Hence the remaining issue involved in the instant case is whether the Appellant is liable to pay interest on the instant sought levy of Countervailing Duty(CVD), under Section 28AA of the Customs Act as confirmed by the learned Commissioner. 8. Submission on Merit: 8.3. The appellant submits that the only issue in the instant appeal is relating to leviability of interest in relation to amounts payable as duty other than basic customs duty. Hence, having voluntarily given up the other question involved in the appeal pertaining to recovery of short levied duty (CVD), the only question for consideration remains leviability and recovery of interest on the of above referred short paid duty and shall therefore alone be considered in the following paras. 5. We have heard the appellant at considerable length on the subject, as regards their stand towards non-payment of interest on the short levied CVD/Additional Duty of Customs leviable under Section 3(1) of the Tariff Act. We have also heard the learned Authorized Repr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tanding the leviability of interest payable on the duty amount short paid, in respect of duty other than basic Customs Duty, reference to Section 3 and Section 3A as well as Section 9A of the Tariff Act is required to be read into. As we are presently concerned with Section 3 of the Tariff Act, the same as it stood at the material time, is reproduced for a comprehensive understanding of the legal provision and for ready reference. Customs Tariff Act, 1975 SECTION 3. Levy of additional duty, equal to excise duty, sales tax, local taxes and other charges.- (1) Any article which is imported into India shall, in addition, be liable to a duty (hereinafter in this section referred to as the additional duty) equal to the excise duty for the time being leviable on the like article if produced or manufactured in India and if such excise duty on a like article is leviable at any percentage of its value, the additional duty to which the imported article shall be so liable shall be calculated at that percentage of the value of the imported article: Provided that in case of any alcoholic liquor for human consumption imported into India, the Central Government may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n making any rules for the purposes of sub-section (3), the Central Government shall have regard (5) If the Central Government is satisfied that it is necessary in the public interest to levy on any imported article [whether on such article duty is leviable under sub-section (1), or, as the case may be, sub-section (3) or not] such additional duty as would counter-balance the sales tax, value added tax, local tax or any other charges (4) For the purpose of calculating under sub-section (5), the additional duty on any imported article, the value of the imported article shall, notwithstanding (i) .. (ii) .. (a) (b) . (c) (d) . (7) 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. (8) The provisions of the Customs Act, 1962 (52 of 1962) and the rules and regulations made thereunder, including those relating to drawbacks, refunds and exemption from duties shall, so far as may be, apply to the duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1962) and the rules and regulations made thereunder, including those relating to refunds and exemptions from duties shall, so far as may be, apply to the duty chargeable under this section as they apply in relation to the duties levaible under that Act. (5) Nothing contained in this section shall apply to any article which is chargeable to additional duties levied under sub-section (1) of Section 3 of the Additional Duties of Excise (Goods of Special Importance) Act 1957 (58 of 1957). (ii) Section 9A. Anti-dumping duty on dumped articles- (1) Where any article is exported (by an exporter or producer) from any country or territory (hereinafter in this section referred to as the exporting country or territory) to India at less than its normal value, then, upon the importation of such article into India, the Central Government may, by notification in the Official Gazette, impose an anti-dumping duty not exceeding the margin of dumping in relation to such article. (8) The provisions of the Customs Act, 1962 (52 of 1962) and the rules and regulations made thereunder, including those relating to the date for determination of rate of duty, asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said that those provisions cannot apply to dealers under the Central Act because the Central Act makes similar provisions. The Central Act is a self-contained code which by charging section creates liability for tax and which by other sections creates a liability for penalty and impose penalty. Section 9(2) of the Central Act creates the State authorities as agencies to carry out the assessment, reassessment, collection and enforcement of tax and penalty by a dealer under the Act. 8. The appellant therefore contends that in view of the aforesaid decision of the Hon ble Apex Court, it is appropriate to hold that penalty/interest is not a continuation of the assessment, proceedings and penalty/interest partakes the character of an additional tax. Emphasising on the need for a charging section to create a liability, they submit that while Section 3 of the Tariff Act does create a charge for Additional Duty, it however, does not provide for interest play. The fact that there is a machinery for assessment, collection and enforcement of tax and penalty under the Customs Act would not automatically mean that the same is replicated for levy and payment of penalty and interest under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vision in the Act for levy of interest on late payment of tax, no interest thereon could be so levied based on the application of sub-section (4) of section 7 of the said Act. In the circumstances, the Tribunal was justified in holding that there being no provision for interest in the Act, there was no justification or warrant to confirm the interest, in the absence of any powers vested in the authorities under the Act. For ready reference the Section 7(4) of Sugar Export Promotion Act, 1958 is enumerated hereunder: (4) The provisions of the Central Excise Act, 1944 (1 of 1944) and the rules made thereunder, including those relating to refunds and exemptions from duty, shall, so far as may be, apply in relation to the levy and collection of the duty of excise or any other sum referred to in this section as they apply in relation to the levy and collection of the duty on sugar or other sums of money payable to the Central Government under that Act or the rules made thereunder. 11. Drawing analogy from the aforesaid judicial pronouncements the principal contention of the appellant is, that in the absence of specific provision for levying of interest (or penalty) due ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the appellant, that breach of provisions of Section 3 or then Section 3A (as now omitted), of the Tariff Act, as well as section 90 of the Finance Act, 2000, have not been made penal. It only provides for application of procedural provisions of the Customs Act. It is their case that for levy of penalty or interest on CVD or SAD or Surcharge, the same needs to be provided for explicitly. That being so, imposition of penalty or interest on additional duty of customs, special additional duty or surcharge, not being connected with the basic customs duty is without authority of law. In support, the appellant heavily relied on the honourable Bombay High Court s decision in the case of Mahindra and Mahindra Ltd. , cited in para 11 above, quoting therein para 22 of the apex court s decision in the case of Khemka and Company (Agencies.) Pvt. Ltd. Vs. State of Maharashtra . The following paras of the Hon ble High Court judgment in Mahindra and Mahindra Ltd. case, from the appellants stand point, also need to be adverted to: 22. In M/s. Khemka and Company (Agencies.) Pvt. Ltd Vs. State of Maharashtra .. The Court held that there must be specific provisions to create lia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng section to create liability. Section 3 and Section 3A of the Customs Tariff Act, 1975 are charging sections creating liability for CVD and SAD but does not provide for penalty. The mere fact the there is machinery for assessment, collection and enforcement of tax and penalty under the Customs Act, 1962 does not mean that the provision for penalty and interest in the Customs Act, 1962 is treated as applicable for penalty and interest under the Customs Tariff Act, 1975. The meaning of penalty or interest under the Customs Tariff Act, 1975 cannot be enlarged by the provisions of machinery of the Customs Act, 1962 incorporated for working out the Customs Tariff Act, 1975. 13. Further, the Apex Court s decision in the case of Orient Fabrics Ltd. , referred to in para 9 above was also discussed by the Hon ble Bombay High Court in the Mahindra and Mahindra Ltd. (Automotive Sector), case. Dwelling thereon the Hon ble High Court observed as follows: 23. In another matter before the Apex Court in Collector of Central Excise, Ahmedabad V/s. Orient Fabrics Pvt. Ltd. , cited by Mr. Sridharan, the question that came up for consideration was as regards to jurisdiction of the autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hority has to be specific and explicit and expressly provided. The Act created liability for additional duty for excise, but created no liability for any penalty. That being so, the confiscation proceedings against the respondents were unwarranted and without authority of law. 7. The Parliament by reason of Section 63(a) of the Finance Act, 1994 (Act No. 32 of 1994) substituted sub-section (3) of Section 3 of the said Act, which now reads as under : 3. Levy and collection of Additional Duties : (1) . (2) .. (3) The provisions of the Central Excise Act, 1944 (I of 1994), and the rules made thereunder, including those relating to refunds, exemptions from duty, offences and penalties, shall, so far as may be, apply in relation to the levy and collection of the additional duties as they apply in relation to the levy and collection of the duties of excise on the goods specified in sub-section (1). 8. A comparison of the amended provisions with the unamended ones would clearly demonstrate that the words offences and penalties have consciously been inserted therein. The cause of action for imposing the penalty and directions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in Chapter II of the Central Excises Act which has the heading Levy and Collection would all be construed as provisions for levy and collection of additional duty as well, is of no avail to the revenue and we reject this argument. In fact, as noted above, Chapter II contains no provision for levy of penalty. 37. When penalty is additional tax, constitutional mandate requires a clear authority of law for imposition thereof. If long drawn arguments are needed to explain the Act by referential legislation, or legislation by incorporation levies penalty or not, it is better for the court to lean in favour of the taxpayer. There is no room for presumption in such a case. The mere fact that all these years the Additional Duty Act has not been challenged on this ground is of no consequence if authority of law as mandated by the Constitution is lacking. We may also note in the passing that it was submitted before us that penalty so realized earlier has never been distributed among the States as part of act proceeds of the collection of the additional duties of excise under the Additional Duties Act. This statement, made at the Bar was not challenged. Since, however, this point wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n.- In this section, the expression the excise duty for the time being levaible on a like article if produced or manufactured in India means the excise duty for the time being in force which would be leviable on a like article if produced or manufactured in India, or, if a like article is not so produced or manufactured, which would be leviable on the class or description of articles to which the imported article belongs, and where such duty is leviable at different rates, the highest duty. (5) 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. (6) The provisions of the Customs Act, 1962 (52 of 1962), and the rules and regulations made thereunder, including those relating to drawbacks, refunds and exemption from duties, shall, so far as may be, apply to the duty chargeable under this section as they apply in relation to the duties leviable under that Act. (Emphasis Supplied) (ii) Section 3A of the Customs Tariff Act: (For Special Additional Duty- SAD): (1) Any article which is imported into India shall in addition be liable t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... harge of Customs, an amount, equal to ten per cent of the duty chargeable on such goods calculated at the rate specified in the said First Schedule, read with any notification for the time being in force, issued by the Central Government in relation to the duty so chargeable. (2) Sub-section (1) shall cease to have effect after the 31st day of March, 2001, and upon such cesser, section 6 of the General Clauses Act, 1897 (10 of 1897) shall apply as if the said sub-section had been repealed by a Central Act. (3) The surcharge of Customs referred to in sub-section (1) shall be in addition to any duties of customs chargeable on such goods under the Customs Act or any other law for the time being in force. (4) The provisions of the Customs Act and the rules and regulations made thereunder, including those relating to refunds, drawbacks and exemptions from duties, shall, as far as may be, apply in relation to the levy and collection of surcharge of customs leviable under this section in respect of any goods under that Act or those rules and regulations, as the case may be. (Emphasis Supplied) 15. The various provisions of Customs Act, 1962, as need to be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner of Customs or with his prior approval by any officer subordinate to him: Provided also that where the amount of duty which has not been levied or has been short-levied or erroneously refunded or the interest payable thereon has not been paid, part paid or erroneously refunded is more than one crore rupees, no notice under this sub-section shall be served except with the prior approval of the Chief Commissioner of Customs. Explanation.- Where the service of the notice is stayed by an order of a court, the period of such stay shall be excluded in computing the aforesaid period of one year or six months or five years, as the case may be. (2) The proper officer, after considering the representation, if any, made by the person on whom notice is served under subsection (1), shall determine the amount of duty or interest due from such person (not being in excess of the amount specified in the notice) and thereupon such person shall pay the amount so determined. (3) For the purposes of sub-section (1), the expression relevant date means,- (a) in case where duty is not levied, or interest is not charged, the date on which the proper officer makes an o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g thirty six per cent per annum, as is for the time being fixed by the Central Government, by Notification in the Official Gazette), from the first day of the month succeeding the month in which the duty ought to have been paid under this Act, or from the date of such erroneous refund, as the case may be, but for the provisions contained in sub-section (2) of section 28, till the date of payment of such duty. (2) For the removal of doubts, it is hereby declared that the provisions of sub-section (1) shall not apply to cases where the duty became payable before the date on which the Finance (No.2) Bill, 1996 receives the assent of the Present. Explanation 1- Where the duty determined to be payable is reduced by the Commissioner (Appeals), the Appellate Tribunal or, as the case may be, the court, the interest shall be payable on such reduced amount of duty. Explanation 2-Where the duty determined to be payable is increased or further increased by the Commissioner (Appeals), the Appellate Tribunal or, as the case may be, the court, the interest shall Commissioner (Appeals), the Appellate Tribunal or, as the case may be, the Court, the interest shall be payable on such incr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be levied on the portion of demand pertaining to surcharge, additional duty being countervailing duty (CVD) and special additional duty (SAD) being levied under Section 3 and Section 3A of the Customs Tariff Act, respectively. The total duty demand raised in the show cause notices consist of the demand of basic customs duty under Section 12 of the Customs Act, 1962, surcharge of customs duty under Section 90 of the Finance Act, 2000, additional duty of Customs equal to excise duty under Section 3 of the Customs Tariff Act, 1975 (CVD) and special additional duty of Customs under Section 3A of the Customs Tariff Act, 1975 (SAD). It is also petitioner s case that Section 28AB of the Customs Act, 1962, interest on delayed payment of duty is applicable only for customs duty leviable under section 12 of the Customs Act, 1962. Section 90 of the Finance Act 2000 relating to surcharge, Section 3 of the Customs Tariff Act, 1975 relating to additional duty of customs and Section 3A of the Customs Tariff Act, 1975 relating to special additional duty of Customs do not borrow the provisions of Customs Act, 1962 relating to interest. 22. In M/s. Khemka and Co. (Agencies) Pvt. Ltd. Vs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mine the context, in which the Hon ble Courts have delivered the same and need to deciphere and segregate the ratio from the orbiter dicta of the law propounded, vis- vis the prevailing statutory provisions that were considered by the courts, the language deployed therein as also the current provisions in the statute and the subject matter under Section 28AA of the Customs Act. 20. The case laws cited and discussed by the appellants in support of their contention are the following: (i) Hyderabad Industries Limited Vs. Union of India (ii) Khemka and Company (Agencies) Pvt. Ltd. Vs. State of Maharashtra and State of Mysore Vs. Guldaas Narrappa Thimmaiah Oil Mills (iii) Collector of Central Excise, Ahmedabad Vs. Orient Fabrics Pvt. Ltd. (iv) Collector of Central Excise Surat I.V. Ukai Pradesh Khand Udyog Mandali Ltd. (v) Mahindra and Mahindra Ltd. (Automotive Sector) Union of India, the Settlement Commission, Additional bench Customs and Central Excise, Mumbai, the Commissioner of Customs, (Import), Mumbai. The Additional director, General, DG CIE, Mumbai (vi) The cited judgemnents inter alia refer to the following citations, that may also call for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l be the date on which an amount of duty is first determined to be payable. Explanation 2.- Where the duty determined to be payable is increased or further increased by the Commissioner (Appeals), Appellate Tribunal [National Tax Tribunal] or, as the case may be, the court, the date of such determination shall be,- (a) For the amount of duty first determination to be payable, the date on which the duty is so determined; (b) For the amount of increased duty, the date of order by which the increased amount of duty is first determined to be payable; (c) For the amount of further increase of duty, the date of order on which the duty is so further increased. (2) The provisions of sub-sections (1) shall not apply to cases where the duty or the interest becomes payable or ought to be paid on and after the date on which the Finance Bill, 2001 receives the assent of the President. (ii) Customs Manual by R.K Jain (2012-2013)(39 th -Edition) (w.e.f. 08.04.2011) 28AA. Interest on delayed payment of duty. (1) Notwithstanding anything contained in any judgement, decree, order or direction of any court, Appellate Tribunal or any authority ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cause why he should not pay the amount specified in the notice; (b) The person chargeable with the duty or interest, may pay before service of notice under clause (a) on the basis of, (i) His own ascertainment of such duty; or (ii) The duty ascertained by the proper officer, the amount of duty along with the interest payable thereon under section 28AA or the amount of interest which has not been so paid or part-paid. (2) The person who has paid the duty along with interest or amount of interest under clause (b) of sub-section (1) shall inform the proper officer of such payment in writing, who, on receipt of such information, shall not serve any notice under clause (a) of that sub-section in respect of the duty or interest so paid or any penalty leviable under the provisions of this Act or the rules made thereunder in respect of such duty or interest. (3) Where the proper officer is of the opinion that the amount paid under clause (b) of sub-section (1) falls short of the amount actually payable, then, he shall proceed to issue the notice as provided for in clause (a) of that sub-section in respect of such amount which falls short of the amount actually ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the amount actually payable then, the proper officer shall proceed to issue the notice as provided for in clause (a) of sub-section (1) in respect of such amount which falls short of the amount actually payable in the manner specified under that sub-section and the period of one year shall be computed from the date of receipt of information under subsection (5). (7) In computing the period of one year referred to in clause (a) of sub-section (1) or five years referred to in sub-section (4), the period during which there was any stay by an order of a court or tribunal in respect of payment of such duty or interest shall be excluded. (8) The proper officer shall, after allowing the concerned person an opportunity of being heard and after considering the representation, if any, made by such person, determine the amount of duty or interest due from such person not being in excess of the amount specified in the notice. (9) The proper officer shall determine the amount of duty or interest under sub-section (8),- (a) within six months from the date of notice, where it is possible to do so in respect of cases falling under clause (a) of sub-section (1); ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of the Customs Act defines the words duty as .. means a duty of Customs leviable under this Act. It may be noticed that in this definition the words under this act , are equally important. It narrows the margin of the words duty to mean a duty of customs . This read with Section 12 of the Customs Act which defines Dutiable goods, brings about a subtle difference in the usage of the words duties of customs . 26. Further, Section 12(1) of the Customs Act, the charging section under the Act is in the nature of an exclusion clause, as it starts with the words Except as otherwise provided in this Act .. . It thus provides primacy to the provisions of the Customs Act 1962 or any other law, as regards the levy of the duties of Customs at rates, as are specified under the Customs Tariff Act 1975 or any other law. Section 12 of the Customs Act, concerning goods on which duty is required to be paid, is reproduced below for ease of reference: 12. Dutiable goods (1) Except as otherwise provided in this Act, or any other law for the time being in force, duties of Customs shall be levied at such rates as may be specified under the Customs Tarif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -materials consumed in the manufacture of imported goods (a component of excise duty leviable on raw-material components and ingredients used in the production or manufacture of the same) [refer Section 3 sub-section (3)] or other duty for example to countervail the impact of the Sales Tax, VAT or other local taxes [Section 3 sub-section (5)] or the components of Integrated Tax [IGST- Section 3 sub-section (7)] or GST Cess [Section 3 sub-section (9)] etc., by way of sub-Section (12) of Section 3 of the Customs Tariff Act clearly makes out provision for granting exemption from the aforesaid duties thus, it read as: [(12). The provisions of the Customs Act, 1962 (52 of 1962) and the rules and regulations made thereunder, including those relating to drawbacks, refunds and exemption from duties shall, so far as may, be apply to the duty or tax or cess, other case may be, chargeable under this section as they apply in relation to the duties leviable under that Act.] 28. In so far as the levy of Safeguard Duty under Section 8B (Safeguard Duty) or 8C (Product specific safeguard duty) or Section 9 (Countervailing Duty on subsidised articles) or 9A (Anti-dumping Duty) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... payment of duty.- (1) Notwithstanding anything contained in any judgment, decree, order or direction of any court, Appellate Tribunal or any authority or in any other provision of this Act or the rules made thereunder, the person, who is liable to pay duty in accordance with the provisions of Section 28, shall, in addition to such duty, be liable to pay interest, if any, at the rate fixed under sub-Section (2), whether such payment is made voluntarily or after determination of the duty under that section. (2) Interest, at such rate not below ten per cent. and not exceeding thirty-six per cent. per annum, as the Central Government may, be notification in the Official Gazette, fix, shall be paid by the person liable to pay duty in terms of Section 28 and such interest shall be calculated from the first day of the month succeeding the month in which the duty ought to have been paid or from the date of such erroneous refund, as the case may be, up to the date of payment of such duty. (3) Notwithstanding anything contained in sub-Section (1), no interest shall be payable where,- (a) the duty becomes payable consequent to the issue of an order, instruction or d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion in order to uphold its enforceability over anything that may be held contrary thereto and assists the digging out and clarifying the legislative intent. Viewed in the context we do not find support to uphold the arguments of the appellant. As commonly understood, appending a non-obstante clause to a provision, gives it an over-riding impact and is co-extensive with the operative part, without in the least, cutting down upon the clear terms of the enactment. In the given context the language used in the statute (Section 3(8) of the Tariff Act) signifies it to be intended by the legislature by way of abundant caution and it would be for the Court/Tribunal to examine every word of the statute in its context and interpret it in its widest sense. 32. During the course of the arguments, a plea was taken on behalf of the appellants that the Customs duties to be levied upon the import of goods are as indicated in the Schedule I to the Tariff Act. In fact a careful conjoint reading of Section 12 of the Act and Section 2 of the Tariff Act would indicate that the rate at which duties of customs , are to be levied could be at such rates as are specified in the Tariff Act be it the two ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the two Schedules of the Tariff Act. Table 34. Usage of Tax Specific Terminologies in various Sections of the Tariff Act Sr. No. Description Section 3(8)/[─ 3(12)] Section 8B(9) Section 8C(5A) Section 9(7A) Section 9A(8) (Additional Duty of Customs) Safeguard Duty (Product Specific Safeguard- imports from PRC) Countervailing Duty Anti Dumping Duty 1. Drawbacks ✓ 2. Refunds ✓ ✓ ✓ ✓ ✓ 3. Exemption from Duties ✓ 4. Date of Determination Rate of Duty ✓ ✓ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndertaken. Also the fact of non-mention of the term appeal , cannot be taken to imply that any dispute, if arises, with reference to such levies imposable by way of various sub-sections of Section 3, are out of the purview of the process of grievance redressal and quasi judicial proceedings. Thus the plea taken by the appellant in support of their argument for non-levy of interest on the short paid additional duty of customs is far from convincing and cannot be accepted. The word - INCLUDING - a perspective 35. As per Justice R.P Sethi s, treatise The Supreme Court on Words and Phrases - Third edition the term include is described as: The word include in the statutory definition is generally used to enlarge the meaning of the preceding words and it is by way of extension, include is very generally used in interpretation clauses in order to enlarge the meaning of words or phrases occurring in the body of the statute; and when it is so used, these words or phrases be construed as comprehending, not only such things as they signify according to their natural import but also include. ( Regional Director, Employees State Insurance Vs. High Land Coffee Works of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in The word includes when used, enlarges the meaning of the expression defined so as to comprehend not only such things as they signify according to their natural import but also those things which the clause declares that they shall include. Similar, ratio about the interpretation of terms includes also flows from the ruling of the Hon ble Apex Court in the case of C.I.T., Andhra Pradesh Vs. M/s. Taj Mahal Hotel, Secunderabad. ( AIR 1972 SC 168 ) The Hon ble Court in the said case had to state, the following: The word includes is often used in interpretation clauses in order to enlarge the meaning of the words or phrases occurring in the body of the statute. When it is so used, those words and phrases must be construed a comprehending not only such things as they signify according to their nature and import but also those things, which the interpretation clause declares that they shall include. 41. The Hon ble Apex Court reiterated the proposition in understanding of the term includes in the case of Narmada Bachao Andolan Vs. Union of India , ( AIR 2005 SC 2994 ) as well as in the case of Godfrey Phillips India Ltd. Anr. Vs. State of U.P. Ors. (AIR 200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Customs Act and Rules and Regulations thereunder, be considered as rendered applicable to the provisions of Section 3 of the Tariff Act. 46. In the case of Commissioners Tax Udaipur Vs. Rajasthan Taxchem Ltd. (2007 (209) ELT 165 SC) - (a sales tax case), an issue arose in respect of Rajasthan Sales Tax Act, 1994, where Section 2(34) defines raw material as goods used as an ingredient in the manufacture of other goods and includes preservatives, fuel and lubricant required for the purpose of manufacture. In this case, diesel was used as fuel for making electricity, which was used for making the end product, polyester yarn and fabric. The revenue contended that diesel was not a raw material at all for polyester yarn. The Supreme Court, despite the fact that diesel was used for the generators needed for production of the ultimate product, however held that the manufacturer purchased diesel as raw material and utilized the same. 46.1. The Supreme Court held that the word includes gives a wider meaning to the words or phrases in the statute. It further held that the word includes is usually used in the interpretation clause in order to enlarge the meaning of the wo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Court of Appeal of Ontario, concerned with the construction of the will of the testator, while allowing the appeal filed. To understand the issue at hand, the following facts of the case and the decision rendered may be referred to:- This is an appeal from a judgment of the Court of Appeal of Ontario, dated 3 rd October 1932, allowing an appeal from the judgment of Orde, J. A., dated 18 th September 1931. The appeal raises a short question on the construction of the will of the testator, Abe Lyons. The will was dated 16 th June 1928. The testator died on 26 th July 1930, after an illness which began early in June. On 8 th June 1930, he was moved to hospital, where he remained until his death. During that time he was mentally incapable of looking after his affairs. He was a member of the firm of Lyons and Marks, and spent most of his time travelling for the firm, only returning to town for weekends. He lived alone in one room in Euclid Avenue, Toronto. The appellant, Kenneth Joseph was in the confidence of the testator, looking after his private financial affairs. He and the testator each had a key of a safety deposit box in their joint names at the Dominion Bank, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision assume that it did not affect any right of the legatee, and proceed to deal with the case as if the books and notes had formed part of the contents of the desk at the death of the testator. The desk also contained other things as to which no question has been raised. The question is whether the bequest on its true construction is only of things which can properly be treated as personal effects, that is to say, physical chattels, having some personal connexion with the testator such as articles of personal or domestic use or ornaments clothing furniture and so forth which would not include money or securities for money or whether in the actual contents it extends to the choses in action represented by the pass books and the promissory notes. Their Lordships are of opinion that the former is the true construction. The bequest is one of personal effects and it cannot properly be said that by the mere direction to include the desk with its contents he intended so to enlarge the scope of the bequest as to include property not within the term personal effects, and the inclusion of which would convert the bequest into a pecuniary legacy of over $30,000. Probably th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he participle including typically indicates a partial list , Further from the case of Nutter Vs. Accrington Local Board [(1879) 4QBD375, PP 384, 385 (CA)] it is clear that when a word is defined to apply to and include, it is understood as extensive. There are a plethora of judicial pronouncements to this settled proposition in law. Likewise, the inclusive definition of a District Judge in Article 236(a) of the constitution has been very widely construed to include hierarchy of specialised civil Courts viz. Labour Courts and Industrial Courts that are not included in the definition, State of Maharashtra Vs. Labour Law Practitioners Association. ( AIR- 1998 SC 1233 ) 53. The words including the power to punish for contempt of itself in Article 129 of the Constitution which declares the Hon ble Supreme Court to be a Court of record, were held not to limit the inherent powers of the Apex Court as a Court of record to punish for contempt of itself and as also of the subordinate courts (Delhi Judicial Service Association Vs. State of Gujarat. (AIR 1991 SC-2176 ) 54. The fact of term/word include being attributed an expansive meaning is clear from the following ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... concept of a seasonal factory. Thereby it demonstrated the expanded and enlarged meaning and usage of the term includes with all the grammatical variations of the word. 57. Even in the context of the definition of word input in Rule 2(k) of the Cenvat Credit Rules, 2004, the Supreme Court in the case of Ramala Sahkari Chini Mills Ltd., U.P. Vs. Commissioner of Central Excise, Meerut-I, Meerut, had held the usage of the word include was in its widest amplitude and as to enlarge the meaning of the word input by way of an extension, dismissing the plea for a narrow restrictive interpretation to the term. Case Law Analysis on interest applicability in connection with duty as determined payable, under the Customs Act. 58. There are umpteen cases wherein the various Courts have repeatedly upheld the enforceability and the applicability of the interest element, be it with reference to a refund claim or a demand matter as may arise with reference to the additional duty of customs leviable under Section 3 of the Tariff Act. We would for records like to refer to some of such cases hereinbelow, as would also be suggestive of the counter narrative to, as championed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fund claims under the said notification within the normal period not exceeding three months from the date of receipt. (Emphasis Supplied) 58.2. The Hon ble Court therefore while quashing as aforesaid, further directed ..and the pending refund application of the petitioner shall be considered by the respondents in the light of Section 27 and 27A of the Customs Act. It even stated that to hold that no interest on delayed payment of interest is contemplated under the notification as a Misconception of the provisions of the Customs Act, 1962. and without the usage of the term and incorporation of the word interest in Section 3(8) (then) or 3(12) (now) granted the interest as leviable under Section 27A of the Customs Act. 59. Let us consider some other cases where interest was held payable by the Courts either on refund of duty of paid, or recovery of short paid duty, arising out of levy under Section 3 of the Tariff Act, i.e. CVD or Additional Duty of Customs or other provisions of the act ibid. While we have already elaborated upon the case of KSJ Metal Impex Vs. Under Secretary (Cus.) MF (DR) where the Hon ble High Court pointed out conseque ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a sequitur, it follows that SAD refundable was a duty paid by the petitioner under the Customs Act in respect of which exemption vide Notification No. 107/2007-Cus., dated 14th September, 2007 has been granted by the Central Government. 12. Section 27 relates to refund of duty or interest paid or borne by the assessee and the manner in which application is to be made for refund of duty and interest paid. Logically, Section 27 applies when an assessee applies and seeks refund of duty including SAD. 13. Section 27A states that duty directed to be refunded under sub-section 2 to 27, if not paid within three months from date of receipt of application under sub-section 1 to Section 27, interest would be paid by the authorities as per the rate specified. In other words, if the refund is paid within three months of date of receipt of application under sub-section 1 to Section 27, no interest is payable. Interest is payable on delayed refunds after three months post the application for refund till the date of refund. Section 27A therefore ensures prompt decisions and payment of refunds, when due and payable under sub-subsection 2 of Section 27 of the Act. 14. ..xxxxxxxx ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 3(8) of the Tariff Act reads as the: Provisions of the Customs Act . including those relating to shall, so far as may be apply to duty or tax or cess ., chargeable under this section, as they apply in relation to duties leviable under the Act. , there appears no ambiguity in law, and the law is required to be in interpreted in a plain and simple manner. Were the word/phrase including in Section 3(8) of the Tariff Act was to be omitted in usage of the language of the section, it could have been considered that the intent of legislature was to invite reference to Customs provisions only to the three specified areas of customs working, viz. drawbacks, refunds and exemption from duties. That, however not being the case, it automatically falls in place that all the provisions of the Customs Act and the rules and regulations are essentially dovetailed into, for consideration and applicability in the Customs Tariff Act, 1975 disregard of all ifs or buts. It is only the penal provisions that need a strict construction, while such is not the case with any machinery provision of a legislation. Thus the appellant is duty bound to pay the interest demanded, moreso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stionably leviable for the delayed payment of duty. 68. Under the circumstances, the case laws relied upon by the appellant are of no bearing to the present matter, for it is well known that precedents sub-silentio and without arguments are of no moment (in the factual matrix of the present appeal). What is binding upon us is the principle and the factual context of the case in which it was decided. Certainly obiter does not constitute a binding precedent for our purpose. Quotability of law, applies to the ratio decidendi and statements that are not part of the ratio decidendi are distinguishable as obiter dicta and are not authoritative. In our opinion, therefore Section 3 of the Tariff Act (including its subsection 8) interpreted on its own language or along with Section 28AA of Act are not ambiguous. The mischief, if any ought to be suppressed with the aid of internal tools like the non-obstante phraseology or the text and the head note of the sections, besides giving the words used in law their ordinary meaning. The apex court in the case of Doypack Systems (Pvt.) Ltd. Vs. UOI, ( 1988 (36) ELT 201 SC ) observed that words used in the statute must prima facie, be given t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tate of Assam, Hyderabad Industries Ltd., Vs. Union of India, J. K. Synthetics Ltd. Vs. Commercial Taxes Officer, Pioneer Silk Mills Pvt. Ltd. Vs. Union of India, Kamat Printers Pvt. Ltd. Vs. UOI (2010 (251) ELT 177 Bom.) and thereafter held as under:- 27 ..Therefore, once it is held that duty is due, interest on the unpaid amount of duty becomes payable by operation of law under Section 28AB, Secondly (Emphasis Supplied) 71.1. The Court went on to analyse the meaning of the expression provisions of the Customs Act , while it had noted and discussed at length several of the judgements referred to by the appellant, in arriving at its decision, it would be pertinent to go through the following paras of the Hon ble Courts order:- 28. We may now proceed to consider the third proposition, whether provisions for interest under the Customs Act are not incorporated either under Section 3 or under Section 3A of the Customs Tariff Act. We may first refer to the relevant provisions of Section 3(1) and 3(6) which read as under:- 3. Levy of additional duty equal to excise duty. (1) Any article which is imported in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder that Act. Our attention was also invited to the provisions of Section 9(7A) inserted with effect from 18th April, 2006 which reads as under:- Unless otherwise provided, the provisions of the Customs Act, 1962 (52 of 1962) and the rules and regulations made thereunder, relating to the date for determination of rate of duty, non-levy, short-levy, refunds, interest, appeals, offences and penalties shall as far as may be apply to the duty chargeable under this section as they apply in relation to duties leviable under that Act. 30. It is sought to be contended that it is only after 18 th April, 2006 that the Customs Tariff Act, 1975 provides for interest. It is in this context that this Court would have to consider the true import of the meaning of the expression that that provisions of the Customs Act, Rules and Regulations made thereunder as far as may be, apply to the duty charged under this Act. It is no doubt true that the provisions of Customs Tariff Act themselves do not provide for interest. However, we may gainfully refer to the expression duty under Section 2(15) of the Customs Act, which reads as under:- duty means a duty of customs leviabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rmined considering the expression, the provisions of the Customs Act shall as far as may apply Section 28AB would be applicable. The amendment of the 18th April, 2006 only clarifies the position. (Emphasis Supplied) 71.2. Further, the Hon ble Court clearly made out a distinction between penalty and interest as far as their applicability was concerned and therefore goes on to state: 31. In the case of Orient Fabrics Pvt. Ltd. (supra) the Court was specifically dealing with the issue of penal provisions like penalty and confiscation. It did not deal with the issue of interest. Interest in that context has not been held to be penal in character. (Emphasis Supplied) Thus this decision of the Hon ble High Court, evidently lays to rest the question of law and the dispute concerned in the present matter. 72. It may not be out of place to state that the Hon ble Apex Court in the case of Pioneer Silk Mills Ltd. (supra), had the following to say for the liability to pay interest: 18. Once, therefore, duty is ascertained then by operation of law, such person in addition shall be liable to pay interest at such rate as fixed by the Board. The concerned Off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by judicial and/or quasi judicial bodies only with respect to cases of refund of Special Additional Duty leviable under Section 3 of the Tariff Act. Examples of payment of interest even in exclusive cases of demand of duty leviable under Section 3 of the Tariff Act do galore, besides the fact that in a very large number of cases (nearly all) wherever interest on refund or demand of duty was held payable, there has invariably been a component of CVD (additional duty) in addition to the basic duty of customs. 77. The objective in pointing out various decisions as above is to counter the narrative of non-applicability of interest provisions to the law laid down under Section 3 of the Tariff Act. It belies logic to say that if interest is applicable to cases of refund, it would not be so for demand cases. Interest and Penalty- Two Varying Concepts- (A Brief Commentary) 78. As the appellant has relied upon several pronouncements of the higher judiciary, rendered in the context of affixing penal liabilities in support of their proposition, it is vital that imposition of penalty and affixation of interest are understood in their proper frame, background and objective. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k of restricting the scope of Section 3 of the Tariff Act to drawback, refund and exemption from duties- the question of enforcement of tax would beg a legal vacuum. This would obviously lead to a situation legally untenable, besides rendering the entire statutory provisions ineffective and worthless. Thus this unsound and flawed interpretation and meaning as assigned by the appellant to the provisions, would have the impact of disintegrating the statutory scope of the provision. We are of the opinion that the interpretation and arguments canvassed by the appellant are fraught with extreme risk leading to the collapse of the provisions themselves and therefore suspect and dubious and hence unacceptable, as far as Section 3 of the Tariff Act with all its appendages is concerned with. The fact of noninclusion of even a single word pertaining to demand of duty, in subsection 3(8) (now sub-section 3(12) in the context would even render inapplicability of Section 28 of the Customs Act, if the analogy as propounded by the learned CA is considered to be of sufficient merit and if the phrase The provisions of the Customs .including those relating to drawbacks, refunds and exem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the provisions of the act or the rules and the regulations. In other words, if the appellants pleadings and reading of law is considered as the appropriate legal interpretation of the statutory provision, we are of the view that in the event of any short levy of Additional Duty of Customs there is no mechanism to realize and recover the same as in that circumstance, Section 28 of the Act is not rendered applicable by virtue of then sub-section (8) of Section 3 of the Tariff Act and now sub-section (12) of Section 3 ibid and as only provisions pertaining to Drawback (Chp. X, Section 74-76) Refund (Section 27 or 26A) and those relating to Exemption from Duties (Section 25) of the Customs Act alone are supposed to be rendered applicable. This would lead to a chaotic situation where the enforceable of recovery of short paid duty is tied down and prevented from legally enforcement action and would be completely dependent upon the willingness and the disposition of the assessee to make good the said charge . Such a situation of interpretative legal anarchy is absolutely incomprehensible in law and the said interpretation is nothing short of an absurdity and a legal folly. The appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rcumstances necessitating 84. Interest as stated earlier is compensatory, while under the taxation laws, penalty is ordinarily levied on an assessee for some contumacious conduct or for a deliberate violation of the provisions of the statute. Penalty is penal in nature that is punishing or punitive in character Consolidated Coffee Ltd. Vs. Agricultural Income Tax Officer, Madikeri and Others. ((2001(1) SCC-278)) Penalty imposed in adjudication proceedings is not by way of a fine, and is required to be backed by an appropriate statutory provision. Penal interest furthermore is clearly distinguishable from interest - the former being an extraordinary liability incurred by a debtor on account of his being a wrongdoer or a violator in law and for which creation of a specific charge for its imposition is essential. Thus while liability to pay interest is founded on the doctrine of compensation, imposition of penalty is based on the doctrine of punitive action. Penalty in common parlance can be understood to mean a legal punishment- be it in the form of a forfeiture, imprisonment or imposition of a monetary cost or charge and its meaning can be derived from the gathering whe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vide for imposition of penalty on contumacious or fraudulent assesses. Penalty is in addition to income-tax, if any determined as payable by the assessee. Tax and penalty like tax and interest are distinct and different concepts under the Indian Income-tax Act. The word assessment could cover penalty proceedings if it is used to denote the whole procedure for imposing liability on the tax payer as happened in Abraham s case. (Emphasis Supplied) This case was also maintained by the Supreme Court [2002 (145) ELT A 74 (SC)]. 87. As for interest, as it is not held and understood to be in the nature of additional tax, therefore it cannot be stated to be strictly falling into the ambit of Article 265 of the Constitution for enforcing its levy and collection, though it is undisputed that interest has its bearings with duty not paid and hence a dependent variable of such circumstances. 88. The Hon ble Allahabad High Court as maintained by the Hon ble Apex Court in the case of Kamrup Industrial Gases Ltd. Vs. CEGAT, New Delhi , ( 2004 (172) ELT 454 Allahabad ), held that provision of the statute have to be so used to make it meaningful and the construction that would re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the adjective law, yet to levy interest there must be a substantive provision. Demand for interest can be made only if the legislature has specifically intended collection of interest. This is so in the present context as well by virtue of Section 28AA of the Act. 92. Likewise, the Hon ble Supreme Court in the case of Commissioner of Central Excise Vs. International Auto Ltd. had held that in view of the statutory provisions under Section 11A of the Central Excise Act, default in the payment of the duty either by virtue of own ascertainment or as ascertained by the Revenue Officer was not exempt from interest chargeable under Section 11AB. 93. We are thus of the view that the legislature having consciously incorporated the interest provision (Section 28AA) in the Customs Act, and as rendered applicable to the Tariff Act, the appellants are not justifiable in seeking to derive support from the judgments cited by them, as the rulings pronounced by the superior courts in the said cases would not be apposite for consideration of the question of interest which arises in the present case. This is so as the said judgments were delivered essentially in the context of penal prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lk Mills Pvt. Ltd. Vs. Union of India, 95. The Hon ble Supreme Court in the case of Commissioner of Trade Tax Vs. M/s. Kanhoo Ram Thekedar, (2005 (185) ELT 3 (S.C)) has taken the view that interest liability accrues automatically. In the case of M/s. Kamat Printers Pvt. Ltd. Vs. Union of India the Bombay High Court had held that once duty is ascertained then by operation of law such person in addition, shall be liable to pay interest at such rate as applicable. 96. As for imposition of penalty it is however not automatic and has to be weighed in accordance with the legal stipulations. The Hon ble Court in Valecha Engineering Ltd. case (supra) went on to great lengths in distinguishing the ratio of the law as propounded by the Apex Court in the Orient Fabrics Pvt. Ltd. case, which was primarily concerned with provisions pertaining to penalty and not interest. It would be worth reproducing the relevant extract of the decision of the Hon ble Court as concerns aspects relevant to the present case: 30 .. We may now refer to Section 28AA. Under Section 28AA interest becomes automatically payable on failure by the assessee to pay duty as assessed within the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the phrase, it has a sort of over-ruling effect overall other stipulations in law. 98. Further, it has often been held to be a duty of the court to press into action, the maxim ut res magis valeat quam pereat to arrive at a meaningful interpretation and to construe the enactment in a manner so as to implement rather than defeat the legislative intent and purpose. As it is the said maxim is put to operation when two meanings are sought to be derived at from the enactment interpreting the plain words used in the statute. Thus, adopting this principle and in view of the plethora of court orders referred in earlier paras permitting the interest outgo in respect of levy under Section 3 of the Tariff Act, interpretation as would carry forward the legislative intent, is required to be adopted. The mandate of the legislature is required to be interpreted to advance the purpose of the legislation, equally in all situations. Thus, reading down the law, as held by courts in several such rulings does not advance the case of the appellants. 99. Moreover, there can be no dispute, to the premise and as oft stated by apex court that where two reasonable constructions are possible, but one ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... how the facts of the cited case fit into the factual position of the given issue. Thus as none of the cases relied upon by the appellant, are in the given factual matrix of this case and cater to the proposition befitting the present appeal, we do not find the cited cases by the appellant, to be of any help in deciding the present matter. (To be fair to the issue raised, a brief commentary on judgments relied upon by the appellant, are incorporated in the order for records, towards the end). 103. Circumstantial flexibility or even a single additional detail or a mild difference in facts, could make a world of difference and lead to different conclusions in two cases, however closely placed. As observed by the Hon ble Apex Court in the case of Collector of C. Ex., Calcutta Vs. Alnoori Tobocco Products, (2004 (170) ELT 135 (SC)) citing the words of Lord Denning: 14. The Following words of Lord Denning in the matter of applying precedents have become locus classicus: Each case depends on its own facts and a close similarity between one case and another is not enough because even a single significant detail may alter the entire aspect, in deciding such cases, one should ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to the particular facts proved, since the generality of the expressions which may be found there is not intended to be exposition of the whole law, but governed and qualified by the particular facts of the case in which such expressions are to be found. It would, therefore, be not profitable to extract a sentence here and there from the judgment and to build upon it because the essence of the decision is its ratio and not every observation found therein. The enunciation of the reason or principle on which a question before a court has been decided is alone binding between the parties to it, but it, is the abstract ratio decidendi, ascertained on a consideration of the judgment in relation to the subject matter of the decision, which alone has the force of law and which, when it is clear what it was, is binding. It is only the principle laid down in the judgment that is binding law under Article 141 of the Constitution. A deliberate judicial decision arrived at after hearing an argument on a question which arises in the case or is put in issue may constitute a precedent, no matter for what reason and the precedent by long recognition may mature into rule of stare decisis. It is th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... egulations thereunder to the three aspects of drawbacks, refunds and exemption from duties, the terms incorporated in the said sub-section does not hold any sway and therefore is certainly only by way of ex-abundanti cautela. The said interpretation rendering rest of the tenets of law as otiose and redundant, cannot therefore be adopted as it does not flow from the words made use of in the statute- The provisions of the Customs Act, . including those relating to drawbacks, refunds and exemption from duties, shall so far as may be, apply to under this section as they apply in relation to the duties leviable under that Act. Indeed, if that was the intent of law, it could simply be indicated as: The provisions of drawbacks, refunds and exemption from duties, so far as may be apply to the duty chargeable under this Section as they apply in relation to the duties leviable under the Customs Act, 1962. 106. Thus a restrictive and narrow interpretation of term including cannot be assigned and adopted in the given context. It belies logic to so do, as it defeats the very purpose of the statutory provisions including certain beneficial piece(s) of legislation which certainly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lines. Thus while Section 46 of the Act provides for filing of Bill of Entry upon import of goods, Section 47(1) of the Act permits clearance of non-prohibited goods for home consumption and upon payment of duty as assessed thereon. Section 47(2) of the act ibid which was introduced in 1991, however provides for payment of interest, in case the importer failed to pay the duty within prescribed timelines (these timelines have been revised from time to time). This provision for payment of interest was a part of the statute even during the material time. In earlier paras it has been elaborately discussed that duty leviable under Section 3(3) of the Tariff Act is also a duty of Customs within the meaning of Section 2(15) of the Act. It cannot now, at least, therefore not be argued that the provisions concerned with filing of Bill of Entry, or the clearance of imported goods for home consumption upon payment of duty are/were rendered applicable to the provisions of the Tariff Act. If the said provisions are applicable to the present case (which in fact are), there can be no escape from payment of interest as applicable. For sake of greater clarity, Section 47 of the Customs Act as it st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent of the duty leviable under Section 12 of the Act (Customs Act). There is absolutely no demur with this proposition or any reason to doubt the veracity of the statement. In fact it is Section 2 of the Tariff Act which has a bearing with Section 12 of the Act, as Section 2 specifically speaks of duties of customs levied under the Customs Act . The fact that section 3 levy is independent of all this is clear from the language made use of in the provisions contained in Section 3 of the Act itself. Even the manner of calculation of additional duty of Customs is provided for in the said section only. While the judgement of the Hon ble Court in this case was in the context of and dealt specifically the issue of leviability of additional duty (CVD) under Section 3(1) on import of asbestos fibre, and were in particular analysing the implication of the words if produced or manufactured in India , as used in Section 3(1) of the Tariff Act, Justice Kripal had the following to say, on behalf of the other judges of the Constitution Bench. 14. There are different types of customs duty levied under different acts or rules. Some of them are, (a) a duty of customs the duty in que ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty. Those are the only provisions for penalty available against the dealers under the Central Act. Each State Sales Tax Act contains provisions for penalties. These provisions in some cases are also for failure to submit return or failure to register. It is rightly said that those provisions cannot apply to dealers under the Central Act because the Central Act makes similar provisions. The Central Act is a self-contained code which by charging section creates liability for tax and which by other sections creates a liability for penalty and imposes penalty. Section 9(2) of the Central Act creates the State authorities as agencies to carry out the assessment, reassessment, collection and enforcement of tax and penalty payable by a dealer under the Act. 112. While accepting the appeal of Khemka Co. (Agencies), it would be prudent to state the obvious, that the provisions pertaining to the Customs Act and the Tariff Act (Section 3), and those in respect of Central Sales Tax Act and the State Sales Tax Act referred to in the order viz Section 9 of the Central Sales Tax Act have no commonality of the purport of the law, the subject under consideration and the nature of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not find any support fanning out for the contention of the appellant, as no ratio in law is laid down by the said decision of the apex court in so far as imposition and levy of interest on delayed payment of duty is concerned. 114. Moreover, in the said case, the basic question concerned was in respect of imposition of penalty for delayed filling of return and not levy of interest for delayed payment of duty. Payment of duty is a statutory and a constitutional obligation and the filling of the return can in no way be held at the same pedestal as that for duty payment. Payment of duty or tax, wherever due, is paramount in law and there can be no escape therefrom without a statutory prescription and authority to so do. 115. The contextual framework in the Khemka s case also rests on premises, where no dispute arises as to the specific ingredients pertaining to assessment/reassessment/collection etc. and all such terminologies within their broad sphere of understanding are incorporated within Section 9 (2) of the Central Sales Tax Act, as assumed to be applicable by reason of Section 9(3) of the Central Sales Tax Act. (as it stood then). It may be noted that Section 3 of the Tar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e on sugar under any other law for the time being in force, and shall be paid by the owner to such authority as may be specified in the notice demanding the payment of duty and within such period not exceeding ninety days as may be specified in such notice. (3) If any such owner does not pay the whole or any part of the duty payable by him within the period referred to in sub-section (2), he shall be liable to pay in respect of every period of thirty days or part thereof during which the default continues a penalty which may extend to ten per cent of the duty outstanding from time to time the penalty being adjudged in the same manner as the penalty to which person is liable under the rules made under Central Excise Act, 1944 (1 to 1944), is adjudged. (4) The provisions of the Central Excise Act, 1944 (1 to 1944) and the rules made thereunder, including those relating to refunds and exemptions from duty, shall, so far as may be, apply in relation to the levy and collection of the duty of excise or any other sum referred to in this section as they apply in relation to the levy and collection of the duty on sugar or other sums of money payable to the Central Government und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... qua broadcaster even before the amendment was brought about by the Finance Act, 2002. 10. Besides, if the liability has been created under the amended section by virtue of sub-section (2) of Section 148 of the Finance Act, 2002, it must be given effect to wholly. The section expressly makes the assessee liable under the amended provision to pay the tax within the period of 30 days from the date of the Presidential Assent to the Finance Bill, 2002. It is admitted that the Finance Bill, 2002 was assented to on 11.05.2002 by the President. In the circumstances, the appellant was entitled to a period of thirty days thereafter to make payment of the tax. Needless to say, if it did not make payment within thirty days from the 11.05.2002, it would be liable to pay interest at the rate specified after that date. 119. Since, this case relies heavily upon certain decisions of the Courts as already discussed in earlier paras, there is therefore nothing much to elaborate on this particular case, being an outcome of interpretation borrowed from other matters. However, it need to be brought on record, that the provisions of the Sugar Export Promotion Act (SEPA) referred to above, do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s scope and the framework of the said arbitration process, specifying the extent of flexibility available to the authority, the consequence of such a ruling etc. 123. Being a shift from the usual process of adjudication, appeal etc. as enshrined in law, any ruling by a higher forum on a decision of the Settlement Commission would certainly have its total applicability to scenarios as existant in the said order under challenge. However, adopting the law propounded on a compromise, in a spirit of conciliation and by way of an exceptional process (though laid out in law), extending its applicability to all normal scenarios is fraught with grave risk including travesty of legal jurisprudence. For this reason, alone we feel that the ruling of the Hon ble Bombay High Court shall have no bearing, implication and applicability to the present issue at hand. 124. Furthermore, this decision of the Bombay High Court in the matter has been arrived at based upon several case laws that have been discussed elsewhere in this order namely- Collector of C. Ex., Ahmedabad Verses Orient Fabrics Pvt. Ltd. 2003 (11) TMI 75- Supreme Court. Hyderabad Industries Ltd. Versus Union of Ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re Section 28AB of the Customs Act was inapplicable. (v) Indian Carbon Ltd. Vs. State of Assam 126. The question concerned in this case was, whether Section 9(2) of the State Sales Tax Act, was concerned with the payment of interest as well. 127. The Hon ble Court observed that Section 9(2) of the Central Sales Tax Act makes applicable to the assessment, reassessment, collection and enforcement of state sales tax the provisions relating to offences and penalties contained in the Central Sales Tax Act, as if the Central Sales Tax Act, was a State Sales Tax Act. It held that Section 9(2) made no reference to interest (in the first part) and there being no substantive provision, therefore it did not oblige the assessee to pay interest on delayed payment of Central Sales Tax. In view thereof it dismissed the plea for payment of interest. 128. It may be noted that Section 9(2) supra clearly enables assessment, reassessment, collection of duty etc. If the law were to be read in the said sense, in respect of Section 3 of the Tariff Act, a serious question would be cast upon the assessment under the Customs Act of the said liability to be taxed, for and because of the non-us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rient Fabrics Pvt. Ltd., relied upon by the appellants, was concerned with the question of resorting to penalty proceedings (for non-payment of additional duty in terms of Additional Duties of Excise (Goods of Special Importance) Act, 1957) and resultant forfeiture of goods. The exact question as framed by the Hon ble Court in the matter, is as under: The short question that arises for our consideration in these appeals, which arises from the judgments and orders dated 10.02.1997 and 26.03.1996, as regards jurisdiction of the authorities under the Central Excise Act, whether it is permissible to resort to penalty proceedings or forfeiture of goods for non-payment of additional duty in terms of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (for short the Act ) by taking recourse to the provisions of the Central Excise Act and Rules framed thereunder. Further, the deliverance of the ratio of the Supreme Court s decision in the aforesaid case rested on the following premise: 20. The matter may be considered from another angle. The Parliament by reason of the Amending Act 32 of 1994 consciously brought in the expression offences and penalties ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... penalty cannot be applied ipso facto to environments and issues relating to imposition of interest. The context in the present matter being compensatory and not punitive action. We therefore fail to derive any support from this ruling of the Hon ble Court in favour of the appellant s contention. 135. Before, we conclude, it may appropriate to cite a ruling of the coordinate bench of this Tribunal delivered in the given context of issue herein: The Tribunal in the case of Atul Kaushik Vs. Commissioner of Customs (Export), New Delhi (2015 (330) E.L.T. 417- T) , had held that Section 3(8) of the Tariff Act had clearly borrowed all provisions of the Customs Act for making them applicable to CVD. The aforesaid decision of the Tribunal was rendered after taking cognizance of several decisions of the Hon ble Apex Court and the Hon ble High Court (Delhi), and more importantly after dwelling upon the following cases, some of which have been relied upon by the appellants. Khemka Company Pvt. Ltd. Vs. State of Maharashtra, Pioneer Silk Mills Pvt. Ltd., India Carbon Ltd. Vs. State of Assam, Relevant para of this decision of the Tribunal in Atul Kaushik s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions of the Customs Act, 1962 and the rules and regulations made thereunder, including those relating to drawbacks, refunds and exemption from duties shall, so far as may be, apply to the duty chargeable under this section as they apply in relation to the duties leviable under That Act. It is evident from Section 3(8) of the Customs Tariff Act, 1975 quoted above that all the provisions of Customs Act, 1962 and the rules and regulations made thereunder have been clearly borrowed into the said Section 3 to apply to the impugned CVD and so it is obvious that the provisions relating to fine, penalty and interest contained in Customs Act, 1962 are expressly made applicable with regard to the impugned countervailing duty. We must, however, fairly mention that in case of Torrent Pharma Ltd. Vs. CCE, Surat, CESTAT set aside penalty for evasion of Anti-dumping duty, CVD and SAD (para 16 of the judgement) on the ground that penal provisions of Customs Act, 1962 had not been borrowed in the respective sections of Customs Tariff Act, 1975 under which these duties were levied, but this decision of CESTAT regarding CVD suffered from the fatal internal contraction inasmuch as CESTAT itse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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