TMI Blog1983 (10) TMI 55X X X X Extracts X X X X X X X X Extracts X X X X ..... e fibre and high performance viscose tow; (ii) High tenacity viscose staple fibre and high tenacity viscose tow; (iii) High wet modulus viscose staple fibre and high wet modulus viscose tow and; (iv) Polynosic staple fibre and polynosic tow." 2. The petitioners contend that on the strength of this exemption, they are not liable to pay any customs duty in excess of 10% ad valorem. 3. The brief facts, relevant for the purpose are these :- 4. The petitioners, have imported into the territory of India, viscose staple fibre or polynosic staple fibre. The import of this fibre attracts customs duty at the rates specified in Chapter 56 of the Customs Tariff Act, 1975, Act 51 of 1975 and also to the additional duty, known as the countervailing duty under Section 3 of the same Act. Under Chapter 56, the customs duty under Section 2 of the Act is said to be 140% for the year 1980-81 and 150% for the year 1983-84. The additional duty is stated to be Rs. 13 per kilogram for 1983-84. 5. Customs notification dated 1-11-1980 extracted in the first paragraph exempted so much of the duty of customs leviable thereon under the First Schedule of Act 51 of 1975 as in excess of 10% ad valor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing leviable on a like article if produced or manufactured in India and if such excise duty on a like article is leviable at any percentage of its value, the additional duty to which the imported article shall be so liable shall be calculated at that percentage of the value of the imported article. Explanation. - In this section the expression "the excise duty for the time being leviable on a like article if produced or manufactured in India" means the excise duty for the time being in force which would be leviable on a like article if produced or manufactured in India, or, if a like article is not so produced or manufactured, which would be leviable on the class or description of articles to which the imported article belongs, and where such duty is leviable at different rates, the highest duty. (2) For the purpose of calculating under this section the additional duty on any imported article, where such duty is leviable at any percentage of its value, the value of the imported article shall, notwithstanding anything contained in Section 14 of the Customs Act, 1962 (52 of 1962), be the aggregate of - (i) the value of the imported article determined under sub-section (1) of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he levy under the Tariff Act or the Finance Act for the import of the goods is customs duty or not, for the answer seems to be simple on the wording of the notification. 13. When customs duty can be levied at the rates fixed under the First Schedule of the Tariff Act, can be enhanced under Section 3 of the Act, or can still further be increased under the Finance Act, there are three statutory methods of augmenting the customs revenue. The exception affects only one of those statutory levies and not to all of them. The levy under the First Schedule of the Tariff Act under Section 2 of the Act alone comes under the beneficial provision of the notification, for, it says "so much of the duty of customs leviable thereon under the said First Schedule". The demands now made and challenged in the writ petitions are under Section 3 of the Tariff Act and not with reference to the rate under the First Schedule. The petitioners admit that they have paid 40% of the ad valorem duty fixed under the First Schedule on the basis of the exemption. They are liable to pay the additional levy under Section 3 or the further levy under the Finance Act for which there is no exemption. 14. If the Revenu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ariff Act, Act 51 of 1975. They are liable to pay the additional levy under Section 3 of the Act or auxiliary duty under the provisions of the Finance Act. 17. A Division Bench decision of the Madras High Court in Sree Ayyanar Spinning and Weaving Mills Limited v. Union of India (W.P. No. 7325 of 1982 - 1983 E.C.R. 199D) has been cited by the Counsel for the Revenue. The very same notification has been upheld by the Madras High Court. It was held by the Division Bench as follows :- 'Mr. K.N. Balasubramaniam, learned Counsel for the Customs Department, said that in drawing up the notifications for exemption it has always been the practice of the Central Government to take care of particularise what precisely is the kind of duty with reference to which exemption is being granted. The Department's counter-affidavit carries some illustrative examples showing this practice. We are not surprised that this precaution is taken in the wording of the notification, what with the variety of customs duties in the field. It is true that the notification in this case does not say or indicate that `basic duty' alone is the subject of exemption. Nor does it expressly exclude the additional duty ..... X X X X Extracts X X X X X X X X Extracts X X X X
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