TaxTMI 
TaxTMI 
2016 (7) TMI 1063
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....jected them to a prescribed rate of duty of Rs. 300/- per liter or 400% whichever is higher specified in respect of Sub-Heading 2208.10 of the Customs Tariff for 1993-94 and 1994-95. The appellant claims to have deposited the amount of duty provisionally assessed on the assessable value declared in the eight bills of entry. According to the appellant, he cleared the goods for home consumption during financial years 1993-94 and 1994-95. Between the years 1994 and 2001 the appellant addressed several communications, inter alia, to the Central Board of Excise and Customs and to the Tariff Research Unit (TRU) of the Union Ministry of Finance. The grievance of the appellant is that the rate which has been prescribed for goods falling under Tariff Sub-Heading 2208.10 is higher than that was authorized in the Budget Proposals during financial years 1993-94 and 1994-95. The appellant took recourse to the provisions of the Right to Information Act in order to procure relevant information from the concerned authorities. According to the appellant, the authorities have not furnished the relevant information. 3. Not satisfied with the attitude of the authorities, the appellant preferred a Wri....
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.... the financial year 1993-1994 in keeping with the Budget Proposal at Sl.No.B1 duly passed by the Parliament for the financial year 1993-94 so also for the financial year 1994-95, it should have been "65%". 7. The appellant would further submit that all the notifications contained in the Explanatory Memorandum 1993-94 and 1994-95 were to give effect to the Budget Proposals duly passed and legislated by the Parliament and rectify the erroneous tariff rates prescribed by the TRU department in the Customs Tariff Act, Finance Bill and Finance Act for 1993-94 and 1994-95; Budget proposals announced by the FM in the Parliament are duly passed and/or approved by the Parliament, no person, executive, bureaucrat or any authority or Court of Law has the authority and/or power to alter or amend the same. If the executives are allowed to prescribe any tariff rates contrary to the Budget Proposals duly authorized by the Parliament, then the Budget Proposals duly passed by the Parliament will have no meaning and will be rendered nugatory and thus opening the flood gates for 'corrupt practice'. 8. He also submits that the goods falling under sub-heading 2208.10 of the Customs Tariff Act are not ....
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....' are not consumable as such, have to be sold to the distilleries where they undergo a process and cannot be treated as Whisky, Gin or Brandy as known in the trade. Against the said decision, Union of India has preferred S.L.P.(C) Nos.13194-210/1991 in this Court wherein this Court has dismissed the aforesaid SLPs upholding the decision of the Bombay High Court. 10. He also places reliance on a judgment of the High Court of Delhi in Seagram Manufacturing Ltd. Vs. Commissioner of Customs, New Delhi, reported in 2003 (154) ELT 610 (Tri.Del.), which is affirmed by this Court reported in 2004 (163) ELT A 205 (SC) wherein this Court, confirming the views of the Tribunal regarding classification, held that 'goods' falling under sub-heading 2208.10 are not intended for immediate consumption and are not 'alcoholic beverages and are classifiable under sub-heading 2208.10 of Customs Tariff'. 11. He would further submit that the TRU department has issued notifications for all other erroneous tariff rates prescribed by them in the Customs Tariff Act, Finance Bill and Finance Act 1993-94 and 1994-95 to give effect to the Budget proposals duly passed and legislated by the Parliament and the re....
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.... of the Finance Minister while presenting the Budgetary Proposals only highlights the more important proposals of the Budget; Budgetary changes are, in fact, enacted by the Parliament as contained in the Finance Bill or ratified by Parliament or implemented through notifications. The legal force for charging a particular rate of customs duty on import of goods, is derived from the First Schedule of the Customs Tariff Act, 1975 read with notifications issued u/s.25(1) of the Act. If any changes in the rates were intended by Parliament it would have been reflected in the respective Finance Bills. 16. He further submits that there was no error or discrepancy between the budget proposals announced by the Finance Minister and the Finance Bill. According to him, the High Court has rightly held that the appellant did not dispute the fact that the goods imported by him fell within Tariff Heading 2208.10 and the position under the Finance Act of 1993 was that the rate of duty prescribed for Tariff sub-heading 2208.10 was Rs. 300/- per liter or 400% whichever is higher and the High Court thus rightly held that budget proposals and the speech of the Finance Minister in Parliament may or may ....
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....imitation into this power." 18. According to him, the Government of India i.e. the TRU is fully empowered to decide the quantum of levy of duty on a particular commodity and to define it. Therefore, no wrong was committed by the TRU when it held that the commodity imported by the appellant did not enjoy the peak duty structure of 70% but fell under the exceptions and replied to the appellant accordingly. The Court, therefore, would not be justified in directing the Central Government to issue a notification in this case. 19. He would further contend that the goods imported by the appellant were cleared provisionally on payment of duty prescribed in the Customs Tariff Act, 1975; the imported compound alcoholic preparation was known as "concentrated extracts". Compound Alcoholic Preparations are used in the manufacture of various beverages and are not for immediate consumption. The claim of the appellant-importer that duty should have been imposed at the rate of 85% for 1993-94 and 65% in 1994-95 and the claim that he had paid excess duty of Rs. 5,62,46,726/- cannot be sustained since all these consignments were assessed provisionally and the goods were classified under Chapter Tar....
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....oposal announced by the Finance Minister in Parliament for financial years l993-94 and 1994-95; (2) a direction to the Chief Commissioner of Customs to finalize assessment of the eight bills of entry after a notification is issued by the first and second respondents under Section 25(1) of the Customs Act, 1962; (3) a writ of Mandamus directing the second respondent to issue a notification under Section 25(2) of the Customs Act, 1962, for granting exemption from customs duty for goods falling under Tariff Heading 2208.10 for financial years 1993-94 and 1994-95; (4) an order to refund after assessments are finalized and (5) an order for the payment of interest at the rate of 12% p.a. on the refund that is ordered." 25. The High Court of Bombay, after giving a thorough consideration, dismissed the writ petition on the ground that once a particular Tariff Heading is prescribed, that constitutes the authoritative expression of the legislative will of Parliament and the High Court cannot exercise its power of judicial review and go beyond the law enacted by the Parliament and it is not permissible for the Court to undertake a scrutiny of whether there was an error on the part of the Pa....
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.... of the aforesaid rival submissions, the issues that fall for consideration are: 1) Whether the budget proposals, as alleged by the appellant, are duly passed and approved by the Parliament and whether the tariff rates fixed by the TRU are contrary to the legislative mandate? 2) Whether this Court can direct the Central Government to issue a notification under Section 25(1) of the Customs Act? 3) Whether the compound alcoholic preparations of a kind used for the manufacturing of beverages fall under the category of alcoholic beverage? 4) Whether there is any discrimination on the part of the Central Government in issuing a notification under Section 25(1) of the Customs Act in respect of other goods and contrary to Article 14 of the Constitution of India? 31. In Re Issue No.1: The whole thrust of the appellant is that the proposals of the Finance Minister were duly approved by the Parliament. No doubt, the appellant has placed before this Court the proposals of the Finance Minister which discloses the intention of the Government but there is no material placed before us to demonstrate that the budget proposals are duly accepted by the Parliament. It is an admitted fact th....
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....nt refused to issue such a notification and it is nothing but mala fide and corrupt practice on the part of the respondents. According to him, the budget proposals passed and approved by the Parliament are paramount and the Executive or Central Government cannot prescribe Tariff rates contrary to the budget proposals and he finds fault with the way the 2nd respondent officials are functioning. A thorough look at the relevant provisions reveals that the source of power to issue notification by the Central Government relates to Section 25 of the Customs Act, 1962, which reads as under: "Power to grant exemption from duty. (1) If the Central Government is satisfied that it is necessary in the public interest so to do, it may, by notification in the Official Gazette, exempt generally either absolutely or subject to such conditions (to be fulfilled before or after clearance) as may be specified in the notification goods of any specified description from the whole or any part of duty of customs leviable thereon. (2) If the Central Government is satisfied that it is necessary in the public interest so to do, it may, by special order in each case exempt from the payment of duty, u....