Court allows conversion of writ petitions into appeals under Customs Act, maintains conflict for future review.

The Court rejected the respondents' objection on the maintainability of the writ petitions, advising the petitioners to pursue remedies under Section 130 of the Customs Act. The Court granted liberty to convert the writ petitions into appeals under Section 130, leaving the conflict between writ remedy and statutory provisions open for future review. The case is set for further consideration on 10.11.2023 for stay vacation applications.

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Issues Involved:
1. Maintainability of the writ petitions.
2. Jurisdiction of the High Court under Article 226 of the Constitution.
3. Applicability of Section 130 and Section 130E of the Customs Act, 1962.
4. Interpretation of the CESTAT's order and its impact on the rate of duty.

Summary:

1. Maintainability of the Writ Petitions:
The respondents raised a preliminary objection to the maintainability of the writ petitions, arguing that since the issues principally relate to the rate of duty of customs, the writ remedy is barred, and the petitioners must seek an appeal under Section 130E(b) of the Customs Act, 1962. The respondents contended that the CESTAT's order, which excluded color-coated aluminum coils from the Customs Notification dated 06 December 2021, falls within the ambit of a rate of duty.

2. Jurisdiction of the High Court under Article 226:
The petitioners, represented by Mr. Chidambaram, argued that the nature of the adjudication by the CESTAT justifies invoking the High Court's jurisdiction under Article 226 of the Constitution. They contended that the issues do not fall within the ambit of Section 130E(b) and that neither Section 130 nor Section 130E fetters the extraordinary jurisdiction conferred upon the High Court by Article 226.

3. Applicability of Section 130 and Section 130E of the Customs Act, 1962:
The Court noted that Section 130 excludes orders relating to the determination of any question having a relation to the rate of duty of customs, which is mirrored in Section 130E(b). The Supreme Court in Steel Authority of India Limited vs. Designated Authority explained that the determination of a rate of duty must have a "direct" and "proximate" relationship to the question of the rate of duty.

4. Interpretation of the CESTAT's Order and its Impact on the Rate of Duty:
The Court examined the CESTAT's order and found that it does not have a "direct" or "proximate" relationship to the rate of duty. The CESTAT excluded color-coated coils from the notification based on the domestic industry's inability to produce or manufacture the product and its production capacity not meeting the demand. This determination does not meet the test of a real, direct, and proximate relationship to the rate of duty as enunciated by the Supreme Court.

Conclusion:
The Court rejected the preliminary objection raised by the respondents, noting that the writ petitioners would be well advised to pursue the remedy under Section 130 of the Act, as it provides an adequate and efficacious alternative remedy. The Court granted the petitioners the liberty to seek conversion of the writ petitions into appeals under Section 130 of the Act, keeping the question of conflict between a writ remedy and Section 130 or 130E(b) open for future consideration.

The matter is scheduled for further consideration on 10.11.2023 for the applications for vacation of stay.

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