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TaxTMI 
TaxTMI 
TaxTMI 
2018 (8) TMI 373
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....ssued on 09.05.2008 and further the said Bill of Entry was not reassessed. Aggrieved by the said order, the respondents filed an appeal with the Commissioner (Appeals) who found merit in the respondent's argument and allowed the appeal. Aggrieved, the Revenue is before this forum. 2. On behalf of the Revenue, Ld. A.R Shri A. Cletus reiterated the grounds of appeal and also made various submissions which can be broadly summarized as under : i) The Commissioner (Appeals) has allowed the respondent's appeal stating application of doctrine of promissory estoppel and giving retrospective effect to the exemption notification on the basis of Hon'ble High Court of Karnataka in the case of UOI Vs Yokogawa Blue Star Ltd. - 2000 (129) ELT 598 (Kar.) which was upheld by the Apex court as reported in 2001 (131) ELT A79 (SC). ii) However, the Hon'ble Apex Court did not address the question of law and have specifically stated in their order that they are "leaving the question of law open". iii) The claim of respondents that change in policy, for rejection of duty for EPCG imports to 3%, was made w.e.f. 1.4.2008 is not substantiated. On the other hand, the reduction in Customs Duty was brought....
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....thorizations. 3. This issues with the approval of D.G.F.T" From the above, it is clear that the goods imported based on EPCG authorization issued from 1.4.2008 to 11.4.2008 will get benefit of reduced rate of 3% Customs duty. iv) In Development Commissioner, MEPZ SEZ, Chennai Vs Hospira Health Care India Pvt. Ltd. - 2017 (356) ELT 167 (Mad.), the Hon'ble Court inter alia held that Foreign Trade Policy (FTP) being an economic legislation which seeks to promote exports by giving various incentives, should in case of ambiguity, be construed liberally in favour of the exporter. v) Ld. Advocate supported reliance of the Commissioner (Appeals) on the judgment of Hon'ble High Court of Karnataka in UOI Vs Yokogawa Blue Star Ltd. 2000 (129) ELT 598 (Kar.) which was upheld by the Apex court as reported in 2001 (131) ELT A79 (SC). The judgement of Yokogawa has upheld the ruling that delay in issuing the notification should not come in the way of implementation of the policy and that "merely because there is a delay in issuing a notification that by itself does not give right to the respondent to seek differential duty from the petitioner in the case; that the authorities in the circumsta....
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....here is a delay in issuing the notification that by itself does not give right to the respondent to seek differential duty from the petitioner in the case on hand. 5.2 Without doubt, the S.L.P filed against the above judgement was dismissed by the Hon'ble Apex Court. It is however useful to reproduce the exact order of the Hon'ble Supreme Court as reported in 2001 (131) ELT A79 (SC) as under : "Delay condoned. Having regard to the facts of the present case, we decline to interfere, leaving the question of law open. The Special Leave Petition is dismissed." 5.3 The High Court of Karnataka had, relying on the judgment of Hon'ble Punjab & Haryana High Court in Nestle India Ltd. Vs State of Punjab -1999 (13) PHT 132 (P&H), ruled that doctrine of promissory estoppel represents principles of equity evolved by the courts to prevent injustice and did not find any substance in the argument that the petitioner therein was not entitled for any concessional duty. However, in our view, the very relevant take away from the order dt. 05.02.2001 of the Hon'ble Supreme Court is that the question of law in the issue has not been dealt with by the Apex Court and has been "left open". 5.4 In ....
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....under Section 25 of the Customs Act that Notification alone would govern the issue of exemption of customs duty. In the instant case a Notification has been issued. The Notification under Serial No. 67 of Table clearly uses the expression steel pots and steel counter pins made of steel as long as they are used for the manufacture of gem and jewellery for export. That has not been disputed. What has been contended is that by virtue of Exim Policy „Press Pots‟ are not entitled to the benefit of the said notification. In our opinion, the stand of the respondents would be contrary to the provisions of the Notification issued under Section 25 of the Customs Act. The Exim Policy cannot have the effect of reading down the Notification issued under the provisions conferred under Section 25 of the Customs Act. The denial, therefore, of the benefit to the petitioners herein would be without jurisdiction and consequently this petition will have to be allowed." 5.6 In our view, the Dimexon judgment (supra) has unequivocally clarified that only a notification issued under Section 25 of the Customs Act, 1962 shall govern the issue of exemption of Customs duty. By implication, the ex....
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....ns. The relevant portions of the said judgment are reproduced as under : "28. It is vivid that the protocol to the Treaty of Trade had made a distinction between the "basic customs duty" and "additional customs duty". The basic customs duty was granted exemption. However, in respect of "additional duty" provisions of Paragraph 3 or 4 were applicable. But, it is significant that the said protocol did not deal with special additional duty. Thus, per se and ex facie it is not possible to accept the position that "special additional duty" was itself exempted under the protocol. Paragraph 1 would not cover the "special additional duty", which was specific and limited as was clear from the exemption notification dated 23rd July, 1996. It was restricted to the goods specified in column 2 of the First Schedule from the customs duty leviable under the First Schedule to the Tariff Act. In fact, special additional duty was not leviable and enforced when the Treaty of Trade was signed and the protocol was executed. Under these circumstances, it is not possible to accept the position that Clause 1 of the protocol had included and had embraced the "special additional duty", which was introduce....
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....catory. It was intended to be applied prospectively. That apart, it cannot be also said the issue of notification was a formal ministerial act which got delayed for administrative reasons. It was a conscious act and a deliberate decision which came into existence after due deliberation when it was decided to grant exemption under Section 3A of the Tariff Act." (emphasis supplied) 5.9 More recently, a five Judge Constitution Bench of the Hon'ble Supreme Court examined the question "what is the interpretative rule to be applied while interpreting a tax exemption provision / notification when there is an ambiguity as to its applicability with reference to the entitlement of the assessee or the rate of tax to be applied ?" in the case of Commissioner of Customs (Import), Mumbai Vs Dilip Kumar and Company & Ors. in Civil Appeal No.3327 of 2007, where in their 82 page judgment of July 30, 2018, the Hon'ble Apex Court has inter alia held that the ratio in Sun Exports case (1997 6 SCC 564) which held that "view favour to assessee in matters of taxation has to be preferred" is not correct and accordingly overruled all the decisions which took similar view. The Hon'ble Apex Court also held ....