Special additional duty relief fails where corresponding excise duty is exempted and not actually chargeable under Section 3A(5).

Special additional duty under Section 3A of the Customs Tariff Act remained payable where the imported goods attracted additional excise duty in principle, but that duty was actually exempted by notification. Section 3A(5) was held to apply only when the corresponding additional duty of excise is truly chargeable, not merely where the goods fall within a category that could attract levy. Because the additional excise duty was not chargeable due to the exemption notification, the importer could not claim relief under Section 3A(5). The cited precedents were treated as distinguishable on their facts and on the legal issue involved.

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Issues: Whether special additional duty under Section 3A of the Customs Tariff Act, 1975 was payable on imported goods where the corresponding additional duty of excise was exempted under the relevant notification, and therefore whether the benefit of Section 3A(5) was available.

Analysis: The goods in question were held to fall under a tariff entry that attracted additional duty of excise under Section 3(1) of the Additional Duties of Excise (Goods of Special Importance) Act, 1957, but that duty was exempted by Notification No. 7/2003-Cus dated 01.03.2003. The decisive question was whether goods that are otherwise leviable to the additional excise duty, but not actually chargeable because of exemption, can escape special additional duty under Section 3A(5). The Court read the expressions "levied" and "chargeable" in their respective settings and held that Section 3A(5) applies only where the additional duty of excise is actually chargeable, not merely where the goods are of a kind that may be leviable in principle. Since the additional excise duty was not chargeable in the present case because of the exemption notification, the appellant could not invoke Section 3A(5). The cited precedents were found distinguishable on their own facts and on the legal issue involved.

Conclusion: Special additional duty was correctly payable, and the appellant was not entitled to relief under Section 3A(5).

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