Exemption notification disputes under customs duty assessment can fall outside High Court appeal jurisdiction and go to the Supreme Court.

A dispute over refund of Special Additional Duty claimed under an exemption notification was treated as directly and proximately connected to the rate of duty for assessment purposes. The governing test is whether the question in issue bears such a direct and proximate relation to duty rate or value that it falls outside the High Court's appellate jurisdiction under Section 130 of the Customs Act. Where the exemption notification determines whether duty is payable, the statutory route lies to the Supreme Court under Section 130E. On that basis, the appeal was not maintainable before the High Court.

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Issues: Whether an appeal under Section 130 of the Customs Act, 1962 lay to the High Court where the dispute concerned refund of Special Additional Duty claimed under an exemption notification and therefore had a direct and proximate relation to the rate of duty for the purposes of assessment.

Analysis: The exemption notification governed refund of Special Additional Duty on imported goods sold in India subject to prescribed conditions. The governing test is whether the question in issue has a direct and proximate relation, for purposes of assessment, to the rate of duty or value of goods. A dispute over the applicability of an exemption notification that determines whether duty is payable falls within that test and is therefore outside the High Court's appellate jurisdiction under Section 130, attracting the statutory route to the Supreme Court under Section 130E.

Conclusion: The appeal was not maintainable before the High Court and lay only before the Supreme Court.

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