TMI Blog2006 (11) TMI 78X X X X Extracts X X X X X X X X Extracts X X X X ..... o the cancellation of the CDEC, the Revenue initiated action against the appellants by way of Show Cause Notice. The Adjudicating Authority, in his order dated 22-6-2004, confirmed a demand of duty of Rs. 30,57,789/-. Further, a redemption fine of Rs. 30,000/- and a penalty of Rs. 10,000/- were also imposed. The appellants appealed to this Tribunal. During the hearing, the learned Advocate made the point that Notification 64/1988-Cus dated 1-3-1988 was rescinded vide Notification No. 99/1994-Cus dated 1-3-1994. However, the CDEC Certificate was cancelled long after the repeal of the Notification, citing various case-laws particularly the decision of the Hon'ble High Court of Madras in the case of Apollo Hospitals Enterprises Ltd. v. UOI - 2001 (133) E.L.T. 58 (Mad.). It was urged that the effect of the repeal of the Notification is that after the repeal, the Notification ceased to exist and the right accrued under the Notification is unaffected by the repeal by virtue of Section 6(b) of the General Clauses Act. It was also urged that the Hon'ble Apex Court has not examined the effect of repeal of Notification 64/88 in the Mediwell case and as this is an important question, the same ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the reason that Notn. No. 64/88 ceases to exist w.e.f. 1-3-1994 and the rights accrued by the appellant cannot be taken away by the repeal of the Notification. (i) Our attention was invited to the following decisions of the Apex Court wherein the effect of repeal of an enactment has been considered. (a) Gajraj Singh v. The State Transport Appellate Tribunal - AIR 1997 SC (412) "Whenever an Act is repealed, it must be considered, except as to the transactions past and closed, as if it had never existed. The effect thereof is to obliterate the Act completely from the record of the Parliament as if it had never been passed by it, it never existed except for the purpose of those actions which were commenced, prosecuted and concluded while it was existing law. When there is a repeal and simultaneous re-enactment, Section 6 of the GC Act, would apply to such a case, unless contrary intention can be gathered from the repealing Act. The Court has to look to the provisions of the new Act only for the purpose of determining whether the new Act indicates different intention." (b) State of Orissa and others v. Titaghur Paper Mills Company Ltd. - AIR 1985 (SC) 1293 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orfeiture or punishment had already been committed before the repealed Act....". 5.The learned JDR made the following submissions :- (i) CESTAT, South Zonal Bench, Chennai, in the case of Jaya Nursing Home (P) Ltd. v. CC, Chennai - 2004 (177) E.L.T. 766 (Tri.-Chennai), had occasion to examine the issue in the light of the Apollo Hospitals case. In the said decision, the Tribunal has held that with reference to Section 159A of the Customs Act, the obligations under the Notification 64/88-Cus. subsisted beyond the date of its recession i.e. 1-3-1994. Further, the ruling of the Apex Court in the Mediwell Hospital case holding that the obligations under the Notification are continuing obligations has been followed. (ii) CESTAT, Northern Bench, New Delhi, in the case of CC (I G), New Delhi v. National Heart Center of Hypertension - 2005 (191) E.L.T. 249 (Tri.-Del.), has held that action can be taken even after the rescission of the Notification 64/88 for non-fulfillment of post-import conditions. In that case also, the Tribunal has distinguished the Apollo Hospitals case, (iii) Further, it was pointed out that the Apex Court, in the Mediwell Hospital case, has held that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... EC was cancelled only on 12-12-1997. The point made by the appellants is that no action can be taken against them after the rescission of the Notification 64/88 on 1-3-1994. The learned Advocates laid great emphasis on the rights acquired by the appellants by virtue of the CDEC Certificate issued to them and if at all any action had to be taken with regard to the liabilities, it should be before 1-3-1994 and not after. The appellants mainly relied on the decision of the Hon'ble Madras High Court in the case of Apollo Hospitals Enterprises P. Ltd. (cited supra). A very careful reading of the Apollo Hospitals decision does not lead us to the conclusion that favoured the appellants. We are reproducing paras 42 and 43 of the Apollo Hospitals decision. "42.However, the question remains for consideration is whether the liability arising out of such extended benefit can be enforced or not, or in other words, whether the penal action of canceling the certificate can be made or not, when the petitioners failed to discharge the obligations arising out of the rescinded notification. 43.Having derived such exemption whether it is open to the petitioners to contend that after the rescinding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, in cases of non-levy, short-levy, etc., on account of fraud, suppression, mis-statement etc. a period of 5 years has been prescribed for issue of Show Cause Notice. As far as fulfillment of exemption notification is concerned, the non-fulfillment entails confiscation of the impugned goods under Section 111(o) of the Customs Act and it is well settled that for taking action under Section 111 (o) of the Customs Act, there is no time limit. In the present case, we cannot say that the appellants had acquired a legal right for the benefit of the exemption notification, which is inviolable, and for the reason that they were in possession of a CDEC. The appellants gave an undertaking to the DGHS to the effect that they would not sell or dispose the imported goods. Thus, the exemption notification in the present case is subject to certain conditions and once those conditions are not fulfilled, the appellants would ab initio be not entitled for the benefit of the exemption Notification. Moreover, it is well settled that Diagnostic Centres would not be entitled for the benefit of the said Notification. The appellant being a Diagnostic Centre is not at all entitled for the benefit of the N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of any rule, regulation, notification or order so amended, repealed, superseded or rescinded; OR (e)affect any investigation, legal proceeding or remedy in respect of any such right, privilege, obligation, liability, penalty, forfeiture or punishment as aforesaid, and any such investigation, legal proceeding or remedy may be instituted, continued or enforced and any such penalty, forfeiture or punishment may be imposed as if the rule, regulation, notification or order, as the case may be, had not been amended, repealed, superseded or rescinded. 33.That section 159A is deemed to have been inserted on and from 1st February, 1963 cannot be questioned. It, therefore, has to be held that Section 159A was operating on 1st April, 1944 when the Notification No. 64/88-Cus was rescinded. In other words, rescission of the Notification No. 64/88 does not affect the liability acquired, accrued or incurred by the petitioners with regard to fulfillment of clause 2(b) of the said notification." 6.2The High Court has clearly held that by virtue of Section 159A, introduced on 1st April, 1994 with retrospective effect from 1st February, 1963, the rescission of Notification 64/88 does not a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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