TMI Blog2018 (8) TMI 373X X X X Extracts X X X X X X X X Extracts X X X X ..... ower of taxation and that tax power must be specifically conferred and it should be strictly in accordance with the power so endowed by the Constitution itself. Appeal allowed - decided in favor of Revenue. - Appeal No. C/93/2012 - Final Order No. 42191 / 2018 - Dated:- 6-8-2018 - Hon ble Ms.Sulekha Beevi, C.S., Member ( Judicial ) And Hon ble Shri Madhu Mohan Damodhar, Member ( Technical ) Shri A. Cletus, ADC (AR) For the Appellant Shri B. N. Gururaj, Advocate For the Respondent ORDER Per Bench The facts of the matter are that M/s.Ace Designers Ltd. (hereinafter referred to as respondents) filed Bill of Entry No.729675 dt.1.5.2008 for clearance of goods under EPCG scheme, claiming benefit under Notification No.97/2004. Accordingly the goods were assessed @ 5% resulting in duty liability of ₹ 38,20,742/- which was paid under protest. Subsequently, the respondents preferred a refund claim of ₹ 15,28,296/- on the ground that they are eligible to pay Customs duty @ 3% instead of 5% under amended Notification No.64/2008-Cus. dt. 09.05.2008. The said claim was rejected, inter alia on the grounds that the Bill of Entry was filed on 1.5.2008 and du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... igh Court of Bombay in Narendra UdeshiVs UOI - 2003 (156) ELT 819 (Bom.). ii) The interpretation which sub-serves the intention of the Central Government as laid down in the Policy as well as the procedure should be given effect to. In this regard, Ld. Advocate drew our attention to the Hon ble Supreme Court decision in UOI Vs Asian Food Industries - 2006 (204) ELT 8 (SC) which has held this ratio. iii) Ld. Advocate drew our attention to DGFT Policy Circular No.6 (RE-2008) 2004-09, dated 7-5-2008 wherein it was clarified as under : Subject : Amendment in EPCG Authorization issued from 1-4-2008 to 11-4-2008. This has reference to the relevant paragraphs(s) of Foreign Trade Policy and handbook of Procedure (RE 11-4-2008) relating to issuance of EPCG authorization at 3% customs duty. The EPCG authorizations were issued at 5% Custom Duty from 1-4-2008 to 11-4-2008, whereas the policy announced on 11-4-2008 has come into effect from 1-4-2008. 2. In this context it is clarified that the EPCG Authorizations issued from 1-4-2008 to 11-4-2008shall be deemed to be issued at 3% Customs Duty as per FTP (Revised 11-4-2008) and Customs shall automatically allowed clearance o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction, a show cause notice was issued and adverse orders were passed against the petitioner. The petitioner acting on the policy imported capital goods and after obtaining license under EPCG scheme at concessional rate of 25% of CIF value subject to undertaking of export obligation to be fulfilled to the extent three times of the CIF value within a period of 4 years. The petitioner placed purchase orders in terms of the policy to procure capital goods to be used exclusively for fulfilment of export obligation in April 1992. The Government permitted the petitioner to import the goods. The petitioner thereafter imported capital goods by filing Bills of Entry and sought for concessional Customs duty which was allowed by the Customs authorities. Only after audit objection, a show cause notice was issued to the petitioner on 7.9.93 to answer short levy in the matter of Excise duty on account of existing benefit of notification. The demand for short levy arose on the grounds that the Customs Notification No.307/92-was issued only on 28.12.1992. The Hon ble High Court of Kartanaka held that delay in issuing the notification in the light of the promissory policy decision of the Government ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as may be specified in the notification goods of any specified description from the whole or any part of the duty of customs leviable thereon. It is pursuant to the power under Section 25 that a Notification in the matter of exemption of goods set out in the table for the manufacture of gem and jewellery for export has been issued by the Government. It is thus clear that duty on customs is payable pursuant to the provisions of the Customs Act and exemption is also pursuant to the provisions of the Customs Act. 4. The Exim Policy has been issued pursuant to the powers conferred under the provisions of the Import and Export Control Act, 1947. Section 3 confers the power on the Government to prohibit and restrict the import of goods. This Act neither confers a power on the Government to impose either duty or to exempt from payment of such duty. 5. When there be two Acts, may be both Special Acts what has first to be examined is the field that they cover. Duty is payable pursuant to the Customs Act. The Import and Export Control Act regulates the import or export of goods. In so far levy of customs duty is concerned, the Customs Act is the Special Act. The issue whether ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the arrival of the aircraft or the vehicle by which the goods are imported, the bill of entry shall be deemed to have been presented on the date of such entry inwards or the arrival, as the case may be. (2) The provisions of this section shall not apply to baggage and goods imported by post. (emphasis supplied) 5.7 In the instant case, the Bill of Entry was admittedly filed by the respondent only on 1.5.2008. Applying the above provisions of Section 15 (1) of the Act and the ratio of Dimexon judgment (supra), the respondent-importer can then lay claim for exemption from customs duty on the basis of a customsnotification, issued under the Customs Act, which was in force on 1.5.2008. As per the facts of this case, the notification in force was EPCG Notification No.97/2004-Cus.. This being so, the respondents cannot then get the rate of Customs duty which was actualized by Customs Notification No.64/2008-Cus. onlyon 9.5.2008. 5.8 In arriving at this conclusion, we also draw sustenance from the ratio laid down by the Hon ble Apex Court in Colgate Palmolive (India) Ltd. Vs CC Patna - 2016 (339) ELT 161 (SC), also been relied upon by the Ld.A.R, where the Apex Court has int ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 34 (S.C.) do not assist the appellant. In the said authorities, the contention of the assessee was accepted on the ground that both power driven pumps as well as parts of power driven pump had for long remained exempt. However, when earlier notifications were rescinded in order to consolidate and reduce the number of notifications and then the new notification was issued on 1st March, 1994 then by mistake and erroneously parts of power driven pump were not included, whereas manufacture of power driven pumps was included. In this context, it was held that the subsequent notification including parts of power driven pump was merely clarificatory and when clarificatory notifications are issued, they have retrospective effect. The instant case is not suggestive of any mistake or error or even inadvertence. The plea that there was delay in issue of notification, exempting special additional duty is not acceptable. It is because, what was earlier exempted under the protocol was basic customs duty and also additional customs duty equal to the duty of excise in some cases and on satisfying the conditions stipulated and it did not deal and relate to special additional duty chargeable under S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arrant visualizing different situations. For instance, if there is ambiguity in the subject of tax, that is to say, who are the persons or things liable to pay tax, and whether the revenue has established conditions before raising and justifying a demand. Similar is the case in roping all persons within the tax net, in which event the State is to prove the liability of the persons, as may arise within the strict language of the law. There cannot be any implied concept either in identifying the subject of the tax or person liable to pay tax. That is why it is often said that subject is not to be taxed, unless the words of the statute unambiguously impose a tax on him, that one has to look merely at the words clearly stated and that there is no room for any intendment nor presumption as to tax. It is only the letter of the law and not the spirit of the law to guide the interpreter to decide the liability to tax ignoring any amount of hardship and eschewing equity in taxation. Thus, we may emphatically reiterate that if in the event of ambiguity in a taxation liability statute, the benefit should go to the subject/assessee. But, in a situation where the tax exemption has to be interpr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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