2011 (4) TMI 1281 - HC - Customs

High Court rejects appeal on duty liability, directs Revenue to Apex Court for exclusive jurisdiction.

The appeal challenging the Tribunal's order on the violation of Notification No. 52/2003 and liability to pay duty for goods sold 'as such' was rejected ... Jurisdictional bar under Section 130(1) of the Customs Act - exclusive jurisdiction of the Supreme Court under Section 130E - interpretation of Notification No. 52/2003-Cus. and EXIM Policy on what constitutes 'manufacture' - maintainability of High Court appeal where question relates to rate of duty or value of goodsJurisdictional bar under Section 130(1) of the Customs Act - maintainability of High Court appeal where question relates to rate of duty or value of goods - High Court's jurisdiction to adjudicate an appeal under Section 130(1) of the Customs Act where the question relates to rate of duty or value of goods for assessment. - HELD THAT: - The Court held that the appeal filed under Section 130(1) of the Customs Act falls squarely within the exception carved out in Section 130, which excludes from the High Court's jurisdiction orders touching on determination of questions relating to the rate of duty of excise or the value of goods for assessment. Reliance was placed on the principle in Commissioner of Central Excise v. M/s. Mangalore Refineries and Petro Chemicals Ltd. As the question before the Court concerns interpretation of Notification No. 52/2003 and what constitutes 'manufacture' for a 100% EOU (which bears on duty liability/value), the High Court lacks jurisdiction to decide the disputed question and the matter is within the exclusive jurisdiction of the Supreme Court under Section 130E.The appeal is rejected as not maintainable for want of jurisdiction in the High Court; liberty reserved to the Revenue to prefer an appeal to the Supreme Court; certified copies to be returned to the Department.Interpretation of Notification No. 52/2003-Cus. and EXIM Policy on what constitutes 'manufacture' - treatment of goods exported 'as such' by a 100% EOU - Whether goods exported 'as such' by the assessee could be treated as 'manufacture' under the EXIM Policy and whether there was a violation of Notification No. 52/2003 disentitling the assessee from exemption. - HELD THAT: - Although the Tribunal had examined the merits and recorded findings that the goods were imported under Notification No. 52/2003-Cus., were bonded, subjected to testing, repacking and relabelling, exported with Customs knowledge, that the proportion exported 'as such' was not very high, and that there was no diversion or revenue loss, the High Court did not decide this substantive question. Because the jurisdictional bar precluded adjudication by the High Court on questions touching rate/value/duty, the legal controversy over whether the EXIM Policy/Notification treats the impugned activity as 'manufacture' was not finally determined by this Court and remains for the competent forum.Substantive issue left undecided by the High Court and to be determined by the Supreme Court; the High Court refrained from adjudicating the merits.Final Conclusion: The High Court rejected the appeal as not maintainable for want of jurisdiction under Section 130(1) of the Customs Act in matters concerning rate/value/duty, reserved liberty to the Revenue to approach the Supreme Court, and did not decide the substantive question whether the goods exported 'as such' amount to 'manufacture' under Notification No. 52/2003-Cus./EXIM Policy. Issues involved: Appeal challenging Tribunal's order on violation of Notification No. 52/2003 and liability to pay duty for goods sold 'as such'.Interpretation of Notification No. 52/2003: Tribunal held issue involves interpreting Notification No. 52/2003 for a 100% EOU. Tribunal stated Board should decide, not Appellate Authority.Goods Exported 'as such': Tribunal found goods imported under Notification No. 52/2003. Allegation of exporting 'as such' without manufacturing process. Tribunal noted goods not extensively exported 'as such'. Goods properly imported, tested, repacked, and relabeled. Exported with Customs Department knowledge. Tribunal viewed activity as manufacturing under EXIM Policy. No revenue loss, export obligations fulfilled, no violation of Notification No. 52/2003.Questions for Consideration: (i) Whether goods sold 'as such' and exported could be considered as manufacture under EXIM policyRs. (ii) Whether violation of Notification No. 52/2003 disentitles exemption from customs dutyRs.Jurisdiction: Appeal filed under Section 130(1) of Customs Act. High Court lacks jurisdiction to decide issues related to rate of duty or value of goods. Citing precedent, appeal should be made to Apex Court under Section 130E for exclusive jurisdiction.Decision: Appeal rejected as not maintainable, allowing Revenue to approach Apex Court. High Court registry directed to return certified copies for appeal filing.