UNION OF INDIA Vs. JINDAL VIJAYANAGAR STEEL LTD

JUDGEMENT

(1.) This appeal is by the Union of India, challenging the order passed by the learned Single Judge by extending the benefit of the notification dated 26-4-2001 to the respondents herein also though by yet another notification the said benefit was conferred on them by notification dated 1-3-2001. For the purpose of convenience, the parties are referred to as they are referred to in the writ petition.

(2.) The first petitioner is a company engaged in the business of manufacture of hot-rolled coils and plates. The second petitioner is the General Manager and shareholder of the company. The respondents issued a notification dated 26-4-2001 in terms of sub-section (1) of Section 25 of the Customs Act, 1962 which amended the notification dated 1-3-2001 by inserting SI. No. 64-A in the matter of Customs Duty payable on metallurgical coke when imported by manufacturers of pig iron or steel. As the petitioner company has adopted the Corex-Basic oxygen furnace - continuous casting process - hot strip mills route, the benefit of the said notification was not extended to them. However, the respondents issued a notification dated 1-3-2002 whereby the basic Customs duty payable to the petitioner was restricted to 5% ad valorem instead of existing 15% ad valorem thus bringing uniformity in the basic Customs duty to all manufacturers of pig iron or steel including the petitioner. The petitioner imported 11 consignments between 26-4-2001 and 1-3-2002 of met coke. Before the issue of the second notification, the petitioner had challenged the first notification on the ground that it was arbitrary and violative of Article 14. The said writ petition was disposed of with a direction to the petitioner to approach the authorities seeking exemption and with a direction to the authorities to consider such representation. Before the said representation was considered the second notification dated 1-3-2002 was issued conferring the benefit of exemption on the petitioner also. Though the authorities took note of the second notification, they did not extend the said benefit from the date of the first notification to the petitioners. Aggrieved by the same, the petitioner preferred a writ petition before this Court. Learned Single Judge after carefully considering the entire material on record and rival contentions, notifications and the decisions of the Apex Court, held that the action of the authorities in not extending the benefit of the notification from 1-3-2001 to the petitioner is discriminatory and therefore, allowed the writ petition and quashed the order passed by the authorities and directed them to extend the benefit from 1-3-2001. Aggrieved by the said order, the Union of India is in appeal.

(3.) Learned counsel appearing for the appellant contended that it is settled law that, when a notification is issued granting exemption in pursuance of the fiscal legislation, the said notifications have to be construed strictly. The benefit of the said notification should not be extended to persons who are not included in the notification. Secondly, it was contended that when a notification is challenged on the ground being discriminatory and if the Court is satisfied of the discrimination, all that it can do is to quash the notification and not extended the benefit to the petitioners who are complaining of discrimination. Lastly, it was contended that the process involved in these two categories of manufacturers of pig iron or steel is totally different, as is clear from the material on record, the first category utilised 80% of coke whereas, the second category utilised only 20% of coke to manufacture iron. That is the reason why the said benefit was not extended to them simultaneously and that cannot be questioned by way of a writ petition. Therefore, he submits that the order of the learned single judge deserves to be set aside.