9911796707
TMI Blog1999 (7) TMI 83X X X X Extracts X X X X X X X X Extracts X X X X ..... 8-2-1993 to the Customs Appraiser. 5% ad valorem was paid. The dispute was only with regard to the additional duty which was stated to be billed under Notification No. 167/86-C.E., dated 1-3-1986 read with Notification No. 44/93-C.E., dated 28-7-1993. The customs authorities have not agreed with the contention and an additional duty of Rs.93,08,030/- was levied. The contention of the petitioner is that since there was full exemption from the Central Excise Duty under Notification dated 1-3-1986 there was no liability to pay additional customs duty. It was also claimed that under Notification dated 28-2-1993 the goods falling under Heading 89.08.00 of I Schedule to the Customs Tariff Act, 1975, when imported into India are exempt from so much of the duty of customs leviable thereon as in excess of the amount calculated at the rate of 5% ad valorem. The duty so determined has already been paid and is not in dispute. 3.Section 3 of the Customs Tariff Act is as under: "3. Levy of additional duty equal to excise duty : (1) Any article which is imported into India shall, in addition, be liable to a duty (hereafter in this section referred to as the Additional duty) equal to the excis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er sub-section (1) would be the excise duty for the time being leviable on a like article if produced or manufactured in India. The condition precedent for levy of additional duty thus contemplated by the explanation is that the article is produced or manufactured in India. The second limb to the explanation deals with a situation where "a like article is not so produced or manufactured". The use of the word "so" implies that the production or manufacture referred to in the second limb is relatable to the use of that expression in the first limb which is of a like article being produced or manufactured in India." It was further observed that the goods imported are to be presumed as manufactured or produced in India and then to see what amount of excise duty is liable thereon. For the purpose of determining the levy of customs duty on goods imported into India Section 12 of the Customs Act was found relevant. For levy of additional duty Section 3 of the Customs Tariff Act, 1975 which is to be equal to the excise duty which is leviable under the Act, was considered relevant. This duty under Section 3 is in addition to any other duty imposed under the Customs Act or under any other ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manufactured in India. It was considered that if an article is not manufactured or produced then there is no liability of duty. It was observed that the additional duty under Section 3 is equal to the excise duty for the time being leviable on the like articles which are imported into India, and a deeming fiction is to be created regarding production or manufacture in India. The notes to clauses to the Customs Tariff Bill, 1975 were taken into consideration under which the additional duty on an imported article was to counter balance the excise duty leviable on the like article made indigenously, or on the indigenous raw materials, components or ingredients which go into the making of the like indigenous article. It was observed that that legislative intent of providing for a charging section in the Tariff Act, 1975 for enabling the levy of additional duty to be equal to the amount of excise duty leviable on a like article if produced or manufactured in India was with a view to safeguard the interests of the manufacturers in India. Even though the impost under Section 3 is not called a countervailing duty there can be little doubt that this levy under Section 3 is with a view to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 3 of the Customs Tariff Act, 1975. It is also stated that the forged documents have been filed but the details of such documents has not been given. The importer is stated to be liable for prosecution under Section 132 of Customs Act, 1962. It is stated that Notification No. 74/1993 is applicable for exemption only in respect of basic customs duty and the notification dated 27-3-1987 under Section 25 of the Customs Act, 1962, exemption is granted in respect of customs duty and additional duty but the Notification No. 74/93 exemption is restricted to the basic duty of customs. It is stated that the petitioner has never claimed the benefit of Notification dated 1-3-1986. The Notification No. 167/86 is giving exemption under Rule 8 of Central Excise Rules, 1944 from the Central Excise Duty in respect of the goods produced in India without the aid of power falling under Chapter mentioned therein. 9.On behalf of the respondent reliance is placed on the judgment in Jalyan Udyog v. Union of India, 1992 (58) E.L.T. 33, wherein it was observed that the contention that ship imported by them for the purpose of breaking up is not being manufactured in India nor is capable of be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndia is not manufactured without the aid of power and there is no exemption from excise duty under any of the Notifications, under Section 3 and as such by no stretch of imagination the petitioner can claim the benefit of Notification dated 1-3-1986 that gives exemption to the items falling under different heading and chapters mentioned therein which are manufactured in India without the aid of power. The ship which has been imported by the petitioner do not fall under any of the Chapter Heading of Notification dated 1-3-1986. The exemption under the said Notification is for the manufactured or produced item without aid of power and since the manufactured product being ship, petitioner cannot claim the benefit on the basis that the scrap obtained by breaking material process or obtained by material would also be exempt. There is no Notification issued under Section 25 of the Customs Act granting exemption from additional duty nor there is any Notification by which the exemption is given to the ships. The reference to goods falling under Chapter 89 and Notification dated 1-3-1986 is in respect of goods which are manufactured in India without the aid of power. 11.Section 3 of Custo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tariff Act refers to the class or description of the article and not the use of it. Since the vessels and floating structures are not manufactured without the aid of power, the benefit of Notification dated 1-3-1986 cannot be claimed. 12.The Notification dated 28-2-1993 also granted exemption from the basic duty that have been issued under Section 25(1) of the Customs Act, 1962. The petitioner has submitted a copy of the Notification dated 28-2-1993. From that notification, the goods and materials falling under Chapter 72 and 73 of Schedule to the Central Excise Tariff Act obtained by breaking up of ships, boats and other floating items have been prescribed for exemption from duty. In respect of additional duty of excise the ultimate product which has been obtained in India is not to be taken into consideration. The decision given by the Calcutta High Court have not considered this aspect of the matter. In view of the interpretation of the notification dated 1-3-1986 the petitioner is liable for payment of additional customs duty. The benefit of Notification dated 28-2-1993 in respect of exemption of excise duty on the goods and materials obtained by breaking up of the ship and b ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
