KAMARAJ SPINNING MILLS LTD. Vs. UNION OF INDIA

JUDGEMENT

(1.) ON 1st November, 1980 by notification of the same date the Government of India, in exercise of the powers conferred by Sub -section (1) of Section 25 of the Customs Act, 1962 (52 of 1962), exempted Viscose staple fibre and Viscose tow, falling within Chapter 56 of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), when , imported into India from so much of the duty of customs leviable thereon under the said First Schedule as is in excess of 10% ad valorem. By subsequent notifications of 26 -8 -1982, 13 -12 -1982 and 1 -3 -1983 the figures and words 10% ad valorem was substituted by 20% ad valorem, 30% ad valorem and 40% ad valorem respectively. There is exemption of customs duty on the same lines in respect of dealings in Polyaosic Fibre. In the first instance it was complete exemption but subsequent on 1 -3 -1983 the exemption was limited to duty in excess of 40% ad valorem.

(2.) THE question that arises for consideration is whether such exemption will also apply to levy of additional duty which is equal to excise duty leviable on the like article when produced or manufactured in India, such levy coming under Section 3 of the Customs Tariff Act, 1975. Mr. K.A. Nair, learned Counsel for the petitioners urged before me that Customs duty is a duty on the act of import and all the duty imposed on the act of import, whatever name by which they are called, is a customs duty. In other words auxiliary duty, additional duty or countervailing duty are all forming part of the Customs duty. Customs duty is a duty levied under the Customs Act. That Act is an enactment coming under Entry 83, List I of the Seventh Schedule of the Constitution of India which reads :

(3.) BEFORE considering the decision that is cited, I would refer to the relevant statutory provisions in the matter. List I in 7th Schedule of the Constitution of India enumerates the subjects on which the Parliament can legislate. Item 83 therein relates to customs duties -import and export duties. Section 12 of the Customs Act provides that levy of, and exemption from, Customs duties; 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 Tariff Act, 1975, or any other law for the time being in force, on goods imported into, or exported from, India. Section 25 of the Customs Act provides power to grant exemption from duty. 'If the Central Government is satisfied that it is necessary in the public interest so to do it may, by notification in the Official Gazette, exempt generally either absolutely or subject to such conditions (to be fulfilled before or after clearance), as may be specified in the notification goods of any specified description from the whole or any part of the customs leviable thereon'. The Customs Tariff Act under Section 2 of the Act as enjoined under Section 12 of the Customs Act deals with the rates at which duties of customs shall be levied ; that is specified in the First and Second Schedules of the Customs Tariff Act. As noted earlier customs duty can be levied apart from under Section 12 of the Customs Act, under any other law for the time being in force. I find that Section 3(1) of the Customs Tariff Act making such a levy. It provides that :