GOVERNMENT OF INDIA Vs. PREMA METAL WORKS MADRAS

JUDGEMENT

(1.) THIS batch of 54 writ appeals can be disposed of by this common judgment as the only substantial issue raised in all these cases is common. The issue is, whether the goods imported by the respondents answered the description of 'Stainless Steel Plates and Sheets' as contained in Item 63 (20-A) appearing in the First Schedule to the Indian Tariff Act as contended by the appellants/Revenue or fell under Item 63(14) which is to the effect 'Cold rolled hoops and strips of stainless steel of 250 mm. width or more' as contended by the various respondents/importers. If the goods imported are found to fall under Item 63(20-A), then the duty payable by the respondents will be at the rate of 100%ad valorem. If, on the other hand, the goods imported are found to fall under item 63(14), the duty payable will be 40%ad valorem. A subsidiary question that might arise if the goods are found to fall under Item 63(14) is, whether the duty at the rate of 40%ad valoremis further reducible by applying the Notification No. 118, Customs, dated 20.8.1965 (hereinafter referred to as the notification).

(2.) BEFORE entering into the controversy as such, let us give the admitted facts. All the respondents/importers had actual users licences to import stainless steel sheets. On the basis of such import licences, they imported the goods and declared before the Customs Authorities that the goods imported were stainless steel sheets in coils. Accepting the declaration of the importers, the Authority levied duty at the rate of 100%ad valoremin accordance with Item 63(20-A). The respondents importers, after paying the duties so levied, cleared the goods, and thereafter preferred applications for refund of the excess duty paid by them on the ground that the goods imported were exigible to duty only under Item 63 (14) read with the notification. The Assistant Collector found in 48 out of 54 cases the applications were time barred under section 27(1) of the Customs Act and therefore rejected the same on that ground. Such orders of the Assistant Collector had been subsequently confirmed by the appellate Authority and by the Government of India, Revisional Authority. In six cases where the applications for refund of excess duty were filed in time, the Assistant Collector considered them on merits and found that the goods imported were stainless steel sheets and, therefore, the duty already levied was in accordance with Item 63 (20-A) and such orders of the Assistant Collector on merits as well were confirmed by the Appellate Authority and by the Revisional Authority.

(3.) THE first writ petition that came up for final disposal was W.P. No. 3993 of 1974. In that case, the application for refund of excess duty was turned down by the authorities as time barred by invoking section 27(1) of the Customs Act. THErefore, there was no occasion for the authorities to consider the case on merits. THE Counter affidavit filed in W.P. 2993 of 1974 also supported the order of rejection of claim for refund of excess duty only on the basis that the application was time barred. Koshal, J. (as he then was), before whom W.P. 3993 of 1974 came up for final disposal, was of the view that notwithstanding the rejection of the application for refund of the excess duty as time barred under section 27(1) of the Customs Act, relief could be granted to the aggrieved party under Article 226 of the Constitution if the excess levy was found to be illegal. Before the learned Judge, reliance was placed heavily on the contents of the compilation published by the Indian Standard Institution entitled "Glossary of Terms relating to Iron and Steel" by the counsel for the importers/petitioners. THE fact that the terms "plates", " sheets"and" strips" are not defined in the statute book was also brought to his notice. For the Revenue, reliance was placed on the instructions issued by the Central Board of Revenue and Customs on the customs side in the year 1934 and reproduced at page 436 of the 14th Edition of Compilation headed "Indian Customs Tariff Guide'. As between these two positions, the learned Judge preferred the one relied on by the counsel for the importers/petitioners. THE learned Judge observed as follows :-" * THE Central Board of Revenue and Customs has not indicated in the instructions above extracted the background thereof or the reason why various pieces of iron or steel were classified as stated. It may, however, be that the classification adopted by the Board was in conformity with the trade meanings of the terms 'strips'," sheets "and "plates" as assigned to them by the trade way back in 1934. Much water has flown under the" * bridges since then and India is a far more developed country industrially than it was in the thirties, and the contents of the compilation published by the Indian Standards Institution referred to above appears to me to be a far more reliable guide for the purpose of the classification in hand then the instructions issued by the Board in that behalf more than 40 years earlier. In coming to this conclusion, I have been influenced not only by the high authority from which the compilation last mentioned proceeds and the foreword contained therein, but also by the fact that since 1965 the Board itself has adopted that classification for the purpose of levying Central Excise duties. "On that view, the learned Judge agreed with the contention advanced on behalf of the importer that the goods imported were to be treated as cold rolled strips of stainless steel or more than 250 mm. width falling within the ambit of the notification and further directed the refund of excess duty thereon.