AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2023 (9) TMI 774
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....osed in terms of Section 3 of the Customs Tariff Act, 1975 [Tariff Act], it would not be entitled to the drawback benefits as claimed. 2. For the purposes of adjudging the validity of the aforesaid objection, it would be apposite to notice the following facts. The petitioner asserts itself to be a precious metal refining firm and in connection with which it imports gold dore bars. During the Financial Year 2013-2014 it is stated to have imported 5,23,533 grams of gold dore bars for refining, further manufacturing and sale. It is further its case that the Central Board of Excise and Customs [CBEC Act, 1962] had issued a Circular No. 36/2010 permitting conversion of free shipping bills from one scheme to another subject to conditions stipulated therein being complied with. The petitioner in compliance of the Reserve Bank of India Circular No. 25 dated 14 August 2013, exported 20% of the gold dore bars which had been imported in the form of gold jewellery. 3. It is further disclosed that it had during the course of such export inadvertently failed to submit duty drawback shipping bills which was required in order to claim drawback benefits and had to the contrary submitted free ship....
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....ed untenable. 7. It was further submitted that the Drawback Notification had provided for an All-Industry Rate [AI Rate] insofar as drawback is concerned and made no distinction between cases where Central Value Added Tax had either been claimed or otherwise. According to learned counsel, since the AI Rate applied, the petitioner stood absolved of establishing the payment of any additional duties. It was then contended that the objection as taken by the respondents, namely, of a violation of Condition No. 23 of the Drawback Notification is also clearly misconceived since the drawback rates as prescribed for tariff items 711301, 711302 and 711401 would become inapplicable only in a situation where the goods manufactured or exported in discharge of an export obligation was in terms of a scheme which provided for "duty free import". It was his submission that since the additional duty as contemplated under Section 3 of the Tariff Act had been duly paid, there was no justification for the respondents taking the position that the imports affected by the petitioner were "duty free". 8. Learned counsel further submitted that the nature of an additional duty which is paid in terms of Sec....
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....tes. Merely because the incidence of tax under Section 3 of the Customs Tariff Act, 1975 arises on the import of the articles into India it does not necessarily mean that the Customs Tariff Act cannot provide for the charging of a duty which is independent of the customs duty leviable under the Customs Act. 15. The Customs Tariff Act, 1975 was preceded by the Indian Tariff Act, 1934. Section 2-A of the Tariff Act, 1934 provided for levy of countervailing duty. This section stipulated that any article which was imported into India shall be liable to customs duty equal to the excise duty for the time being leviable on a like article if produced or manufactured in India. In the notes to the clauses to the Customs Tariff Bill, 1975 with regard to clause 3 it was stated that "clause 3 provides for the levy of additional duty on an imported article to counterbalance the excise duty leviable on the like article made indigenously, or on the indigenous raw materials, components or ingredients which go into the making of the like indigenous article. This provision corresponds to Section 2-A of the existing Act, and is necessary to safeguard the interests of the manufacturers in India".....
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....vailed" refer to the total drawback (customs, central excise and service tax component put together) allowable and those appearing under the column "Drawback when Cenvat facility has been availed" refer to the drawback allowable under the customs component. The difference between the two columns refers to the central excise and service tax component of drawback. If the rate indicated is the same in both the columns, it shall mean that the same pertains to only customs component and is available irrespective of whether the exporter has availed of Cenvat or not." [Emphasis is ours.] 74. A perusal of condition no. 6 would show that "...if the rate indicated is the same in both the columns, it shall mean that the same pertains to only customs component and is available irrespective of whether the exporter has availed of cenvat or not." 75. It must be stated here that the aforementioned notifications i.e., notifications dated 04.10.2012 and 14.09.2013 have been, inter alia, issued by the Government of India in the exercise of powers under Section 75(2) of the Customs Act, 1962 and Rules 3 and 4 of the 1995 Rules and hence, in terms of para 8.3.6 of the HBP, they would have to be....
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....no drawback can be granted. 12. Having noticed the rival contentions as addressed, we proceed to evaluate the claim as laid by the writ petitioner hereinafter. The Customs Act specifies the duties payable on the import of goods in Section 12 which constitutes the charging section of that enactment and reads as follows:- "12. Dutiable goods.-(1) Except as otherwise provided in this Act, or any other law for the time being in force, duties of customs shall be levied at such rates as may be specified under the Customs Tariff Act, 1975 (51 of 1975), or any other law for the time being in force, on goods imported into, or exported from India. (2) The provisions of sub-section (1) shall apply in respect of all goods belonging to Government as they apply in respect of goods not belonging to Government." 13. Section 3 of the Tariff Act makes the following provisions: - "3. Levy of additional duty equal to excise duty, sales tax, local taxes and other charges.- (1) Any article which is imported into India shall, in addition, be liable to a duty (hereafter in this section referred to as the additional duty) equal to the excise duty for the time being leviable on a like article if p....
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....oms Act, it continues to remain in the genre of a customs duty. It was further pertinently observed that while the two statutes are independent, merely because the tax under Section 3 of the Tariff Act is imposed on the import of articles into India, it would not mean that the Tariff Act could not provide for a levy of duty independent of customs duty. 15. We thus find ourselves unable to sustain the contention of Mr. Ramachandran who had argued that the levy of an additional duty would not qualify as a duty. More importantly, we note that Rule 2(a) of the Drawback Rules, 1995 while defining "drawback" provides that the same would be relatable to goods manufactured in India and exported and the concept of "drawback" being the rebate of "duty" or "tax" chargeable on any imported material or excisable materials in the manufacture of such goods. It is not possible to view the levy under Section 3 of the Tariff Act as not falling within the ambit of "duty" or "tax". 16. In terms of Rule 3 of the Drawback Rules, 1995, an exporter is entitled to claim a drawback on the export of goods at such amount or rates as may be determined by the Union Government. The Drawback Rules, 1995 thus em....