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2017 (7) TMI 10 - HC - Customslevy of import fee on import of Denatured Ethanol - Rule 52 of the Gujarat Bombay Denatured Spirit Rules, 1959 - Held that: - considering the pith and substance of the levy of fees on import of Denatured Spirit / Ethanol on import of the same from other States and considering the fact that there is a Prohibition Act in the State of Gujarat and therefore, considering Article 47 of the Constitution of India and Entry 33 of List II of Schedule 7 of the Constitution of India read with Entry Nos. 6, 8, 24, 51 and 68 of List II and Entry 33 of List III of Schedule 7 of the Constitution of India and the purpose and object for which the import fee is levied, it cannot be said that such a levy is beyond the legislative competence of the State as contended on behalf of the petitioners. While the impugned levy of fees on import of Denatured Spirit / Ethanol though is held to be within the legislative competence of the State, does it pass the test of quid pro quo or not - Held that : - the State Government has not undertaken any supervisory activity which will constitute quid pro quo for the imposition of the import fees. As observed by the Hon’ble Supreme Court in catena of decisions more particularly decisions referred to hereinabove, there is a distinction between a “fee” and a “tax”. A tax is levied as part of a common exaction, whereas a fee is payment towards services rendered. The purpose for which the fee is being collected (so stated in the affidavits in reply) viz. to protect the interest of the Distelleries in the State of Gujarat, has no nexus with the import fees to be collected on import of Ethanol from outside Gujarat. Thus, there is no element of quid pro quo - Impugned levy of import fee under Rule 52 of the Gujarat Bombay Denatured Spirit Rules, 1959 is held to be invalid under the law and is hereby quashed and set aside - Decided in favor of the assessee.
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