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2014 (9) TMI 441 - GUJARAT HIGH COURTLevy of Additional Customs Duty u/s 3(1) of CTA - Countervailing duty (CVD) - importer prayed to declare the heading No.89.08 of the Central Excise Tariff Act, 1985 (5 of 1986) as unconstitutional and ultra vires Entry No.84 of the Union List - import of old discarded and un-seaworthy ships for breaking up of such old and scrap ships at Sosiya, Alang. - Held that:- Hon'ble Supreme Court in the case of Hyderabad Industries Ltd. Versus Union of India, [1999 (5) TMI 29 - SUPREME COURT OF INDIA] ruled that on a correct interpretation of the relevant provisions of the two Acts, additional duty which is leviable under section 3(1) of the Tariff Act is independent of the Customs Duty which is leviable under section 12 of the Customs Act. It is further observed and held that the observations in Khandelwal Metal & Engineering Works [1985 (6) TMI 178 - SUPREME COURT OF INDIA] seems to suggest that even no process of manufacture or production has taken place the imported articles can still be subjected to the levy of additional duty, does not appear to be correct inasmuch as the measure for levy of additional duty is the quantum of excise duty leviable on a similar article under the Excise Act. Applying the ratio of the law laid down by the Hon'ble Supreme Court in the case of Hyderabad Industries Ltd. Versus Union of India, [1999 (5) TMI 29 - SUPREME COURT OF INDIA], referred to hereinabove to the facts of the case on hand, and with respect to the additional duty sought to be levied under heading No.89.08 at the rate of 15% on the vessels and other floating structures for breaking up which are not manufactured in India and therefore, no excise duty is leviable on "vessels and other floating structures for breaking up". No additional duty can be levied under section 3(1) of the Tariff Act on the "vessels and other floating structures for breaking up". Under the circumstances, aforesaid heading 89.08 which provides levy of additional duty at 15% on the vessels and other floating structures for breaking up would be contrary to and/or ultra vires to section 3(1) of the Tariff Act and therefore, we are of the opinion that the vessels and other floating structures imported into India for breaking up, additional duty under section 3(1) of the Customs Tariff Act is not liable to be levied. - decided in favor of assessee.
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