DIMEXON Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioner is a partnership firm whose partners are national and citizen of India. The petitioner are manufacturers of Gems and Jewellery. It is the case of the petitioners that the action of the respondents in denying to them the benefits of exemption Notification No. 159/86 dated 1st March, 1986 is arbitrary. It is set out that the exemption notification grants exemptions to various machines/equipments which are imported for use in the manufacture of Gems and Jewllery by registered exporters of Gems and Jewellery and Cooperative Societies of Gold Smiths and artisans and used in processing and manufacture of gem and jewellery for the purpose of export. The impugned Notification under Serial No. 67 reads as "steel pots/steel counter pins". In the instant case we are concerned with steel pots which were imported by the petitioners and in respect of which the customs exemption notification is being denied to them.

(2.) The respondents have filed a reply of one Ramkrishna Gopal Bandodkar. In para.4 of the said reply with reference to the averments in para.49 of the petition it is set out that the amendment dated 1.8.1989 to List I of Appendix VI of the EXIM POLICY added three type of pots and at the same time retaining item as Sr. No. 68 - Steel Pots, and Steel Counter Pins which is clearly indicative of the fact that there is a distinction between these goods namely (1) Bottom Pressed Pots (2) Top Pots and (3) Pots for bottom and top to work on fancy cut stones over and above steel pots. Since the additional three items are not mentioned in the Custom Notification, they would be clearly outside the purview of the said Notification and Department's action was correct and justified in denying duty benefit. The classification of the goods follows the Harmonized System of Nomenclature (HSN) and, therefore, the description of the goods either in the Custom's Tariff or the Import Policy would closely follow each other. As the EXIM POLICY has clearly distinguished between "Steel Pot & Press Pots", it is illogical on the part of the department to exclude "Press Pots" from the benefit of said Notification No. 159/86 and 108/89.

(3.) We have heard the learned Counsel for the parties and their respective arguments. In the first instance in so far as the Customs Act is concerned, Section 12 is the charging Section which sets out that 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 thereafter confers a power on the Government if it is satisfied in the public interest to exempt generally either absolutely or subject to such conditions as may be specified in the notification goods of any specified description from the whole or any part of the duty of customs leviable thereon. It is pursuant to the power under Section 25 that a Notification in the matter of exemption of goods set out in the table for the manufacture of gem and jewellery for export has been issued by the Government.