PARASRAMPURIA INTERNATIONAL Vs. CCE

JUDGEMENT

(1.) The issue involved in this appeal filed by M/s. Parasrampuria International is whether the Basic Customs duty which is exempted from payment of duty is to be included in the assessable value for the purpose of levying the Additional Customs duty.

(2.) Shri M.P. Singh, learned Advocate, submitted that the Appellants, a 100% E.O.U., manufacture various types of yarn; that they had sold polyester viscose blended yarn to M/s. Rajasthan Spinning and Weaving Mills Ltd. who were holding the Quantity Based Advance Licence against release Order, on payment of Central Excise duty in terms of Notification No. 82/92 -CE dated 27.8.92; that subsequently they filed a refund claim as they had paid duty in excess of the duty leviable since they had added the amount of basic customs duty which was otherwise exempted in the assessable value for arriving at the value for the purpose of determining the duty; that the Asst. Commissioner under Order -in -Original dated 11.4.97 sanctioned the refund to them holding that if basic Customs duty is nil, the quantum of Additional Customs duty would be calculated from the assessable value of the goods adding nil customs duty; that however, on appeal, filed by Revenue, the Commissioner (Appeals) has set aside the Order -in -original holding that after computation of excise duty payable as per law the same would be reduced by an amount equal to the basic customs duty as Notification No. 82/92 -CE exempts that portion of the customs duty which is equivalent to the basic customs duty leviable on like goods when imported into India. The learned Advocate, further, submitted that only the chargeable amount of basic customs duty is to be added to the assessable value for the purpose of calculating the Additional Customs duty; that since the chargeable amount of basic customs duty is nil in view of exemption contained in Notification No. 82/92 -CE the Additional Customs duty has to be calculated on the assessable value itself without addition of any other element; that any Section for the levy and collection of the duty has to be read with the exemption Notification, if any.

(3.) Countering the arguments Shri R.C. Shankhla, learned SDR, submitted that as per proviso to Section 3(1) of the Central Excise Act the duty of Excise shall be levied and collected on excisable goods manufactured in a 100% E.O.U. and such duty shall be equal to the aggregate of the duty of Customs which would be leviable under Section 12 of the Customs Act on like goods imported into India; that the manner is provided in Section 3 of the Customs Tariff Act for the purpose of computing the Additional Customs duty; that as per Sub -section (2) of Section 3 of the Customs Tariff Act the value of the imported articles shall be the aggregate of the value of the imported articles and any of duty of Customs chargeable on that article under Section 12 of the Customs Act and any sum chargeable on that article under any law for the time being in force; that accordingly the Customs duty chargeable on like articles is to be added in the value of the goods cleared by a 100% E.O.U. for the purpose of levying Additional Customs duty. He, further, submitted that Notification No. 82/92 -CE has been issued under Section 5A of the Central Excise Act and not under Section 25 of the Customs Act; that accordingly this Notification cannot change chargeable rate of Customs duty which is to be considered for computation of value under Section 3 of the Customs Tariff Act; that accordingly the Basic Customs duty which is leviable on like articles is to be included in the assessable value for the purpose of levying Additional Customs duty.