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TMI Blog1991 (7) TMI 85X X X X Extracts X X X X X X X X Extracts X X X X ..... upto 30th September 1980. On 29th August 1980 the Central Government issued another notification under Section 25(1) in relation to aluminium ingots whereby the same were exempted from such portion of the additional duty leviable thereon as was in excess of 12.5 per cent ad valorem. On 9th September 1980 a third exemption notification was issued by the Central Government relating to aluminium ingots and thereby the same were exempted from the whole of the basic customs duty leviable thereon. The position, therefore, at that time was that importers of aluminium ingots had to pay no basic customs duty and only 12.5 per cent of the additional duty thereon. 4. On 2nd December 1980, a notification was issued under the provisions of Section 25(2) of the Customs Act relating to 30,639 tons of aluminium ingots which were being imported by the Minerals and Metals Trading Corporation India (MMTC). The text of the notification is as follows: - "Ad hoc exemption Order No. 948 F. No. 355/160/79 Cus. I Government of India , Ministry of Finance, Deptt. of Revenue, New Delhi , the Deptt. of Revenue, New Delhi , the 2nd December 1980 . To The Collector of Custo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der a bill of lading dated 22nd August 1980. The Appellants had also imported another 7.962 M.T. of aluminium ingots. Both the consignments were landed in Bombay in or about September 1980. Additional duty at the rate of 12.5 per cent and 10 per cent surcharge was levied thereon, in the aggregate sum of Rs. 9,95,679-99 Ps. The writ petition was filed by the Appellants for a declaration that the exemption notification dated 18th August 1980 continued to remain in force and effective upto 30th September 1980, for a declaration that the levy of additional duty at the rate of 13.75 per cent on the c.i.f. value of the aforementioned aluminium ingots was unreasonable, unconstitutional and without the authority of law, and for a writ seeking the refund of the said amount of Rs. 9,95,679-99 Ps. 6. When the writ petitions were heard by the learned Judge, the plea that the exemption notification dated 18th April 1980 continued to remain in force upto 30th September 1980 was given up. What was pressed was the argument of hostile discrimination which was pleaded in the following words : - "Both the Petitioners and the MMTC are importers of aluminium rods and ingots and both of them import ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rate of 125 per cent and auxiliary duty at the rate of 25 per cent. The writ petitions that the private importers filed complaining of the preferential treatment accorded to the S.T.C. as compared to them were dismissed by the Delhi High Court. There was no objection before the Supreme Court in the appeals to the canalization in favour of the S.T.C. The objection was restricted to the alleged differential treatment. The Supreme Court observed that it was apparent that the power conferred on the Central Government under Section 25(2) was to be exercised by it in its subjective satisfaction. The Central Government had to be satisfied that it was necessary in the public interest to pass a special exemption order. The exercise of the power was controlled by the requirement that the exemption order must contain a statement stating the circumstances of an exceptional nature under which the special exemption order had been considered necessary. The requirement was intended to ensure that the satisfaction of the Central Government concerning the necessity of the order was not reached arbitrarily but flowed from material relevant to the object for which the power had been conferred. The ci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The need for preventing 'vanaspati' prices ruling high was also to prevent people normally using 'vanaspati' from switching over to edible oils, thus leading to an imbalance in the market. An overall view made it necessary to ensure that domestic prices of 'vanaspati' remained at reasonable levels. The policy of the Central Government was to have sufficient supplies of edible oil at hand in order to feed the market. It was, therefore, considered desirable and in the public interest to reduce the rate of customs duty to five per cent on the imports made by the S.T.C. It was the Central Government which had to be satisfied, as the authority appointed by Parliament under Section 25(2), that it was necessary in the public interest to make the special order of exemption. It had set out the reasons which prompted it to pass the orders. The circumstances mentioned could not be said to be irrelevant or unreasonable. It was not for the Court to sit in judgment on the sufficiency of the reasons. It was true that the State donned the robes of a trader when it entered the field of commercial activity and, ordinarily, it could claim no favoured treatment, but there might be clear and good reaso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nium ingots/wire rods is being imported by the Minerals and Metals Trading Corporation India (MMTC) to meet the shortage of the aluminium in the country. Since the c.i.f. price of imported aluminium is almost equal to the indigenous price, taking into account the need for distributing it at reasonable price, it has been felt necessary to exempt aluminium from the whole of the countervailing duty of Customs (basic and auxiliary duties of customs were already exempt.)" (Emphasis supplied) They would seem to suggest that what was felt necessary was to exempt aluminium from additional duty and not only the consignment of 30,639 metric tonnes of aluminium ingots which was being imported by MMTC. No affidavit has been filed by the Respondents in reply to the petition. We have not before us any of the sort of material that was placed before the Supreme Court in M. Jahangir Bhatusha's case. There does, therefore, appear to be some substance in the contention that no good reason has been made out why private importers of aluminium ingots should be treated differently from the MMTC, but we need express no definite conclusion because, for the reasons we now set out, the appeals must fai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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