Court distinguishes additional duty from countervailing duty, upholds Revenue's stance. Petitioners denied relief, liable for duty.

The Court rejected the petitioners' argument equating the additional duty under Section 3(1) to countervailing duty, upholding the Revenue's position. The Court emphasized that the additional duty is distinct from countervailing duty, following a Supreme Court decision clarifying the nature of this duty. The Court ruled against the petitioners, denying their claim for relief and affirming their liability to pay the additional duty under Section 3(1) of the Customs Tariff Act, 1975 for importing the ship for breaking up.

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Issues:
1. Liability of petitioners to pay additional duty under Section 3(1) of the Customs Tariff Act, 1975 for importing a ship for breaking up.

Detailed Analysis:
The petitioners, a partnership firm engaged in purchasing old ships for dismantling, questioned the imposition of additional duty under Section 3(1) of the Customs Tariff Act, 1975, for importing a ship for breaking up. The petitioners argued that countervailing duty, akin to excise duty, should not apply as the ship was not manufactured in India or capable of being manufactured in India for any purpose other than breaking up. They contended that countervailing duty aims to equalize duty payments between imported and locally manufactured goods. However, the Revenue's counsel argued that the additional duty under Section 3(1) is distinct from countervailing duty, citing a Supreme Court decision that clarified the nature of this duty (AIR 1985 SC1211). The Court noted that the Supreme Court's ruling established that Section 3(1) is not an independent charging section and the additional duty is not equivalent to countervailing duty.

The Court rejected the petitioners' argument equating the additional duty under Section 3(1) to countervailing duty based on the Supreme Court's interpretation of the Tariff Act. The Court emphasized that the additional duty is separate from countervailing duty and upheld the Revenue's position. The petitioners' attempt to distinguish the Supreme Court's decision based on the type of goods involved was dismissed by the Court, highlighting that the key consideration is the interpretation of the law rather than the specific facts of the case. Consequently, the Court ruled against the petitioners, denying their claim for relief and dismissing the petition. The Court discharged the Rule with costs, affirming the liability of the petitioners to pay the additional duty under Section 3(1) of the Customs Tariff Act, 1975 for importing the ship for breaking up.

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