Countervailing duty exemption for taxi saloon cars extends to importers treated as manufacturers under the tariff scheme.

Imported saloon cars used solely as taxis were held entitled to the additional 10% exemption under Notification No. 64/93-C.E. because, for countervailing duty purposes, the importer is treated as the manufacturer under Section 3(1) of the Tariff Act. Applying the principles in Thermax and Hyderabad Industries, the Court reasoned that an exemption tied to the domestic excise structure cannot be denied merely because the claimant is an importer, where the notification's object is to extend the concession to saloon cars registered for taxi use. The earlier contrary view was found inconsistent with the statutory scheme and the notification's purpose, and the assessee's appeals were allowed.

---

---

Issues: Whether an importer of saloon cars used solely as taxis is entitled to the additional 10% exemption under Notification No. 64/93-C.E. on the footing that, for the purpose of countervailing duty, the importer is to be treated as the manufacturer.

Analysis: The notification granted concessional countervailing duty on goods falling under Heading 87.03 and extended an additional 10% exemption where the saloon car, after clearance, was registered for use solely as a taxi. The decisive phrase was "the manufacturer of the said saloon car". The reasoning in Thermax and Hyderabad Industries was applied to the scheme of Section 3(1) of the Tariff Act, under which imported goods are to be treated, for duty purposes, as if they were manufactured in India. On that principle, the benefit of an exemption notification directed to the domestic excise duty structure cannot be denied merely because the claimant is an importer, where the very object of the notification is to extend the concession to saloon cars used as taxis. The earlier view treating the importer as ineligible was therefore inconsistent with the statutory scheme and the object of the notification.

Conclusion: The importer is entitled to be treated as the manufacturer for the purpose of the notification, and the claim for the additional 10% exemption succeeds.

Final Conclusion: The assessee's appeals were allowed, the Revenue's appeals were dismissed, and the assessee became entitled to refund of 10% countervailing duty.

Ratio Decidendi: For determining countervailing duty under Section 3(1) of the Tariff Act, the importer must be placed in the position of a domestic manufacturer, and an exemption notification linked to the duty payable on a like article manufactured in India extends to the importer where the notification's purpose and conditions are otherwise satisfied.

---