Countervailing duty on imported raw silk remained payable despite textile cess exemption under the Textile Committee law.

The additional duty at 0.05% ad valorem, linked to the textile committee cess, was held leviable on imported raw silk because the exemption under the Textile Committee law applied only to cess on textiles manufactured in India. That exemption did not extend to countervailing duty under Section 3(1) of the Customs Tariff Act, 1975, and no separate customs exemption notification was shown. The text also notes that the issue was already covered by an earlier decision holding the customs additional duty chargeable at the same rate as the cess, so the levy on the imported goods was upheld in favour of the Revenue.

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Issues: Whether the additional duty at 0.05% ad valorem, equivalent to textile committee cess, was leviable on imported raw silk despite the exemption from cess for handloom or powerloom textiles under the Textile Committee law.

Analysis: The rate fixed by the notification was for the cess leviable under the Textile Committee enactment on textiles manufactured in India, and the exemption in that regime did not extend to countervailing duty under Section 3(1) of the Customs Tariff Act, 1975. No separate exemption notification covering the customs levy was produced. The matter was covered by the earlier decision on the same issue, which held that the customs additional duty was chargeable at the same rate as the cess.

Conclusion: The additional duty was leviable on the imported goods, and the exemption from cess under the Textile Committee enactment did not bar the customs levy. The appeal succeeded in favour of the Revenue.

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