2013 (10) TMI 1053

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....4 and Rs.21,58,008.02 respectively. The petitioner claimed duty free clearance, but the same was denied by the Department on the ground that in terms of the impugned Notification No.127/99, they shall be subjected to the rate of 50% customs duty. 3. The Notification is challenged on the ground that it is ultra-vires Section 8-A of the Customs Tariff Act, 1975 (hereinafter called as the "Tariff Act"). It is further contended that Section 12 of the Customs Act, 1962 is the charging section, wherein it is stated that duties of the customs shall be levied at such rates as may be specified under the Customs Tariff Act on the goods imported into or exported from India and wheat has been classified under Sub Heading 1001.90 provided for duty free clearance and in Column No.4 of the Tariff Table, no rate of duty or Nil rate of duty is specified, but only the word free is mentioned. Unless the rate of duty is mentioned in the Customs Tariff Act, imposition of fresh levy by way of Notification cannot be issued under Section 8-A of the Customs Tariff Act to increase the rate of duties. Therefore, it is contended that the imposition of 50% of the Customs Duty on the imported wheat is ultra-....

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....zette, direct an amendment of that Schedule. It is submitted that under Sub Section 1 of Section 8A of the Customs Tariff Act, the expression "leviable" has been used and if the Tariff Viz., Chapter X is perused, the rate of duty has been mentioned as Free and not that Nil rate of duty. When the expression Nil has been used, it denotes no duty is leviable and in such circumstances, the question of invoking the said provision under Section 8A of the Customs Tariff Act for levying 50% of duty is wholly without jurisdiction. In this regard, the learned counsel also referred to Section 12 of the Customs Act, which states that duties of customs shall be levied at such rates as may be specified under the Customs Tariff Act. Therefore, the learned counsel submitted that unless a duty is either levied or leviable, then alone the question of increase or decreasing the rate of duty will arise and the entry "Free" denotes that 'no duty' is leviable and therefore, the impugned Notification is bad in law. The learned counsel referred to the decision of the Honourable Apex Court in the case of Associated Cement Companies Limited., Vs. Commissioner of Customs reported in 2001 (128) E.L.T.21 (SC).....

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....f the Customs Act defines import to mean bringing into India from place outside India. 9.4 Section 12 of the Customs Act, which falls under Chapter V of the Customs Act dealing with levy of, and exemption from, Customs Duties. 9.5 Section 12(1) of the Customs Act states that except as otherwise provided under the Customs Act, duty of customs shall be levied at such rate as may be specified under Customs Tariff Act or any other law for the time being in force, on goods imported into or exported from, India. 9.6 Therefore, the levy of customs duty in terms of Section 12 of the Customs Act is on the goods imported into or exported from India and rate of levy is as per the Customs Tariff Act, 1975. 10. The Customs Tariff Act, 1975 was enacted to amend the laws relating to Customs Duties specified in the Schedules at the rates, at which duties of customs shall be levied under the Customs Act, 1962 (52 of 1962), as specified in the First and Second Schedules. The First Schedule deals with import duties/tariff and Second schedule deals with export duties/tariff. 11. Section 8A of the Customs Tariff Act deals with Emergency power of the Central Government to increase import ....

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.... the term Free has been used in the Tariff Schedule, does not mean that the power under Section 8A of the Customs Tariff Act cannot be invoked. The correct interpretation would be it is Nil rate or Zero rate of duty, which is varied by virtue of a notification issued under Section 8A of the Customs Tariff Act. 16. The main test that should be satisfied for issuing a notification under Section 8A of the Customs Tariff Act is that the article should be included in the First Schedule of the Act. Section 8 of the Customs Tariff Act is concerned about increasing the import duty in respect of article found in the First Schedule. So the emphasis is on the article and not on the rate. 17. Given the fact that the variation could be brought to the rate as warranted by public interest, it is totally immaterial whether the duty prescribed therein should be a matter of concern for this Court to advert its attention on the arguments raised by the petitioner. 18. The learned counsel for the petitioner placed reliance on the decision in the case of Associated Cement Companies Limited. Vs. Commissioner of Customs reported in 2001 (128) E.L.T.21 (SC). The question therein was as to whether ....