TMI Blog2018 (7) TMI 36X X X X Extracts X X X X X X X X Extracts X X X X ..... f controlling local sugar prices. Apparently since inadvertently the withdrawal of exemption also hit the exports of sugar against advance authorization, the Government of India on the representations made by the trade, quickly reintroduced the exemption limited to such class - the Government of India was correcting an inadvertent error or an unintentional withdrawal of the exemption. If that be so, the exemption notification dated 6-7-2016 must be viewed as clarificatory or curative in nature. Petition allowed in part. - Special Civil Application No. 7542 of 2017 - - - Dated:- 1-11-2017 - Akil Kureshi and A.Y. Kogje, JJ. Shri Paresh M. Dave, Advocate, for the Petitioner. Shri Devang Vyas and Sudhir M. Mehta, Advocates, for the Respondent. JUDGMENT [Judgment per : Akil Kureshi, J. (Oral)]. - The Petitioner No. 1 is a company registered under the Companies Act. The Petitioner No. 2 is the authorized officer of the company. Petitioners have prayed for a declaration that no export duty was recoverable on the petitioners export of sugar against valid advance authorization during a period between 16-6-2016 to 5-7-2016. 2. The petition arises in following f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which had nothing to do with re-export of sugar after its import and value addition. The petitioners therefore made a representation dated 27-6-2016 to the Principal Commissioner Customs, Kandla, and pointed out as under : 8. The Central Government vide Notification No. 37/2016 has withdrawn exemption on export of all types of sugars falling under GTH 1701 to contain domestic supply of sugar. 9. However, the present case of the applicant is quite different from the sugar manufacturers who procure raw materials domestically for the manufacture of sugar. Unlike others, the sugar being produced is not from sugarcane or any other domestic raw material. The applicant is importing raw sugar under Advance Authorization scheme which in turn used in the manufacture of final exported products i.e. it has no bearing on domestic availability of sugar. 10. For the purposes of export applicant is bringing entire raw sugar from outside India. Whatever raw sugar is being imported by the applicant is being exported after a value addition. This act of the applicant is not going to affect the availability sugar in India as applicant is not exporting any sugar which is otherwise available i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clearly spelt out this. It is significant to mention here that the government intention was not to bring the white sugar export made under advance authorization in the purview of export duty. (8) Considering the ambiguity in the issue, we have raised the issue with the Central Government for necessary clarification which was accepted and another Notification No. 41/2016 was issued. The above said factual and legal position is now cleared by the said notification. (9) However, since customs was building up pressure to pay export duty on the already cleared consignments, and that the said Notification 41/2016 was delayed, we have paid an ad hoc amount of INR 2,00,00,000/- vide TR6 Challan No. 72, dated 8 July, 2016 and DD No. 030107, dated 8-7-2016 under protest and subject to refund with applicable interest. 8. No further developments took place from the respondent s end in this regard. The competent authority issued a show cause notice dated 27-12-2016 why the export duty of ₹ 4.21 crores not be confirmed with interest and penalty. At this stage, the petitioners have filed the present petition. Main contention of the petitioners is that withdrawal of the exemption o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ort of sugar from local market or re-export of sugar imported against advance authorization. 12. The petitioners have contended in the petition and which has not been disputed by the respondents in their reply that there was a severe shortage of sugar in the local market which prompted the Government to take effective steps to control the price of sugar. Counsel for the petitioners has additionally placed on record certain newspaper reports, one of them is of the Financial Express quoting the tweet of Minister of Food and Consumer Affairs which refers to the decision of the Government to impose export duty of 20% on export of raw, white or refined sugar to keep domestic prices of the sugar under check. It was on account of such thinking process on part of the Government of India that the said notification came to be issued on 16-6-2016 withdrawing the exemption on export of sugar. 13. We also have on record the two representations made by the petitioners to the department and the Hon ble Minister of Finance dated 27-6-2016 and 24-6-2016 respectively, in which, the petitioners highlighted that the entire basis and purpose for withdrawal of exemption on export duty on sugar was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r prices. Apparently since inadvertently the withdrawal of exemption also hit the exports of sugar against advance authorization, the Government of India on the representations made by the trade, quickly reintroduced the exemption limited to such class. Very clearly thus, the Government of India was correcting an inadvertent error or an unintentional withdrawal of the exemption. If that be so, the exemption notification dated 6-7-2016 must be viewed as clarificatory or curative in nature. Any other view would leave the said class of exporters uncovered for a period of about three weeks allowing the department to levy the export duty which is a wholly unintended consequence of the Government of India policy. 16. We have formed this opinion on the basis of precedence of the Supreme Court and this Court. In case of W.P.I.L. Ltd. v. Commr. of C. Ex., Meerut reported in [2005 (181) E.L.T. 359 (S.C.)], the Supreme Court considered a case where an exemption notification was withdrawn and a fresh notification was issued shortly thereafter exempting duty of excise on parts used in manufacturing of power driven pumps. The Court noted that there was a consistent policy of the Government of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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