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TMI Blog2025 (2) TMI 79X X X X Extracts X X X X X X X X Extracts X X X X ..... ose, the appellant imported parts and components used in the manufacture of power banks and claimed the benefit of exemption notification number 50/2017-Cus dated 30.06.2017 which provides exemption to "Parts, components and accessories except populated, printed circuit boards for use and manufacture of lithium-ion batteries other then batteries of mobile handsets including cellular phones falling under tariff item 85076000". 4. According to the appellant, it is entitled to the benefit of this exemption notification whereas according to the Revenue this exemption will not apply to parts of power banks and will apply only to parts and components of lithium-ion batteries. 5. We have heard Shri Narasimhan, learned counsel for the appellant and Shri Nagendra Yadav, Learned Authorised Representative for the Revenue and perused the records. 6. We find that an identical question was before this bench in Customs Appeal No. 55572 of 2023, M/s XO or Technologies LLP vs. Principal Commissioner and in Customs Appeal No. 50221 of 2021- M/s Ambrane India Pvt Ltd Vs Commissioner of Customs (Preventive)- New Delhi. In both appeals, it was decided that parts of power banks were eligible for exem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lants have been submitting to the Concerned officers as 'Information" the block diagram of Lithium-Ion Battery Pack. Admittedly no objection earlier was ever raised about the process of manufacture shown in those diagrams nor about the claim that Lithium Ion Battery is being manufactured by the appellants. Thus, it stands admitted procedure that imported Lithium Ion Cells are connected with other such cells by use of imported nickel strips/stainless strips (imported parts) by means of electrical welding both manually as well as mechanically. Imported cables are then been connected the imported heat resistance tapes and Insulation stickers are used on the imported Lithium Cells to be wrapped around terminal of those cells as a protection measure to avoid any shot circuit/over-heating. The form stickers are also used around the combination of those imported cells to act as a shock observers only and to keep the cells tightly packed in the imported protective case. At this stage it is lithium Ion Battery which comes into existence. 28. As per the above quoted definition of Manufacture of IGCR Rules, 2017, to avail the benefit of exemption under the notification no. 50/2017, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. Otherwise also the period in question is subsequent to coming into effect of Goods and Service Tax Act, 2017 repealing most of the provisions of Excise Act, 1944. Above all the language of notification has to be strictly interpreted as has also been impressed upon by the department. In the case Dilip Kumar & Co. (supra) the Hon'ble Supreme of Court though has held that ambiguity in exemption notification the benefit thereof cannot be claimed by the assessee and has to be interpreted in favour of Revenue. However, it has simultaneously held that when words in a statute are clear, plain and unambiguous sand only one meaning can be inferred the courts are bound to give effect to the said meaning irrespective of the consequences in applying rule of plain meaning any hardship and Inconvenience cannot be the basis to alter the meaning to the language employed by the legislation. Especially in fiscal statutes and penal statutes, it has also been held that regard must be had to the clear meaning of words and matter should be governed wholly by the language of notification, equity or Intendment having no place in interpretation of tax statute. It is only in case of two possible inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... authority of law - No tax shall be levied or collected except by authority of law.) prohibits the State from extracting tax from the citizens without authority of law, It is axiomatic that taxation statute has to be interpreted strictly because State cannot at their whims and fancies burden the citizens without authority of law. In other words, when competent Legislature. mandates taxing certain persons/certain objects In certain circumstances, expanded/interpreted to include those, which were not intended by the Legislature. iv) 22. At the outset, we must clarify the position of 'plain meaning rule or clear and unambiguous rule' with respect of tax law. The plain meaning rule suggests that when the language in the statute is plain and unambiguous, the Court has to read and understand the plain language as such, and there is no scope for any Interpretation. This salutary maxim flows from the phrase "cum inverbis nullaam bigultasest, non debet admittivoluntatis quaestio". Following such maxim, the Courts sometimes have made strict interpretation subordinate to the plain meaning rule (Mangalore Chemicals case (Infra para 37).), though strict interpretation is used in the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e manufacture of battery pack of cellular mobile phone. 5% 1 17 B 8507 60 00 Lithium ion cell for use in the manufacture of power bank of lithium ion 5% 1 33. From the perusal of the above, it is evident that w.e.f. 29.01.2019, lithium-ion cells were taken out of the scope of Serial No. 512 of Notification No. 50/2017-Cus and placed in a separate entry 17B of Notification No. 02/2019 where those were made chargeable to duty at the rate of 5%. Conversely, Lithiym-ion cells were squarely covered within the ambit of Sr. No. 512 prior to 29.01.2019 and were eligible for exemption. Hence, the amendment made vide Notification Nos. 02/2019-Cus and 03/2019- Cus both dated 29.01.2019 clearly manifest that before the amendment, subject goods were exempted vide Notification No. 50/2017-Cus. Post the above amendment, the subject goods have been withdrawn from exemption notification and have been placed under the duty rate of 5%. 34. After the discussion above, it is important to also check as to how HSN code considered the products in question at the relevant time i.e. during the year 2017 to 2019. It can judicially be noticed that the period in question from 2017 to 2019 wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to a printed circuit board which is meant for converting the 3.7 volt stored energy to 5 volt energy as is required by the gadget to be charged through the said power bank working on Lithium Ion Battery. It also stands established that it is only the printed circuit board (PCBA) which distinguishes a generic Lithium Ion Battery from power bank. Appellant is admittedly paying Customs Duty on the import of said PCBA 41. XXXXXX XXXX XXXXX 43. Department's another submission is that in the year 2017 itself, a Notification No. 01/2017 dated 26.06.2017-IT vide entries 376 AA and entries 376AAA had distinguished lithium-Ion Batteries (376AA) from Lithium-Ion Accumulators including Power bank(376AAA), based upon which the department alleged that the power bank was known as a different product than lithium battery since the Year 2017 itself. But we find that entry 376AA came into existence only on 20.08.2018 and it talks only about Lithium Ion Batteries. The entry no, 376AAA though introduced the word Power Bank but we observe that this entry came into existence on 29.01.2020 ie. after the period in dispute. 43.1 In the light of entire above discussion we hold that from the raw ..... 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