VIJAY PRATAPRAI MEHTA Vs. UNION OF INDIA

JUDGEMENT

(1.) THE question which arises for our consideration in this petition under Article 226 of the Constitution of India is whether an exemption notification issued under the Central Excises and Salt Act, 1944 (hereinafter referred to as "excise Act" giving certain benefits of exemption to the assessee under Excise Act stands automatically extended to imports under the provisions of the Customs Act, 1962. For deciding the above question a few facts are briefly required to be stated : -

(2.) IN view of the above facts, the petitioner has sought to challenge in this petition the levy of the basic customs duty at 80% ad valorem as well as the levy of additional customs duty as mentioned above. It was contended that since the copper scrap is not excisable as it was not a product of manufacture, the excise duty could not have been levied by the Excise Authorities on the said scrap and therefore, according to the petitioner, since the scrap is not excisable, no additional duty could have been levied under the Customs Act, 1962. Secondly, it was submitted in the alternative that even assuming that copper scrap is excisable nonetheless in view of the notification No. 35/81-C. E. dated 1st March, 1981 issued under Rule 8 of the Central Excises Rules, 1944 no additional duty could have been imposed or levied under the Customs Act, 1962. To complete chronology of events it may be mentioned that by section 48 of the Finance Act, 1981 Item No. 26a of the First Schedule to the Central Excises and Salts Act, 1944 came to be amended and a specific item No. (1b) came to be inserted covering scrap and waste. It may be also mentioned that by a general notification bearing no. 169/80/c. E. dated 1st November, 1980, the effective rates of excise duty for waste and scrap were made available at Rs. 3,000/- per metric Tonne and special excise duty at the rate of 10% of the effective duty was also levied and accordingly additional duty in the present case equal to the excise duty liable at the relevant time was imposed at the rate of Rs. 3,300/- per Metric Tonne. The contention of the petitioner is that the said amount of Rs. 3,300/- per Metric Tonne by way of additional duty could not have been levied in view of the exemption notification No. 35/81-C. E dated 1st March, 1981.

(3.) AS regards the first contention of the basic customs duty, the parties agreed that pursuant to the subsequent valuation and classification done by the Customs Authorities, the basic customs duty as contended by the petitioner was accepted at the rate of 45% ad valorem and therefore the said controversy no more survives in the present petition.