TaxTMI 
TaxTMI 
2026 (3) TMI 1165
X X X X Extracts X X X X
X X X X Extracts X X X X
....omatograph Machines" was installed in the Laboratory attached to the factory of the Appellant itself, and though vide letter dated 18.1.2002 the conditions of licence was regularised by the Director General of Foreign Trade, Ahmedabad, subsequent to earlier communication dated 9.2.1999? 2. Whether the Tribunal is justified in confirming the demand of differential duty in view of the fact that the condition no. 6 of the notification dated 5.6.1995 has been amended by the Central Government widening the scope of the word "Factory" in subsequent notification dated 30.6.1998 and regularised the condition no. 6 in the Notification no. 110 of 1995 dated 5.6.1995 ? 3. Whether the Tribunal is justified in coming to a finding that the Director General of Foreign Trade is not the proper authority to examine the availability of the customs notification and the same is the job of the customs officer and the DGFT authority cannot dilute the conditions of the Customs Notification. Therefore, whether the Tribunal is justified in holding that installation of machines at the laboratory amounts to breach of Condition no. 6 of the Import Licence ?" 3. In the present Tax Appeal, t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....IT (Appeals) directed the appellant to deposit the entire amount of duty and interest. Subsequently an application was filed by the appellant seeking modification of the said order. The Superintendent (Appeals) refused to modify the order and accordingly, the department recovered the amount of Rs. 1,32,000/- by encashment of the bank guarantee which was furnished by the appellant towards the goods of the appellant without giving them any hearing in the matter. The CIT (Appeals) vide order dated 28.12.2001 rejected the appeal filed by the appellant. Thereafter, the licensing authority vide order dated 18.01.2002 regularized the installation of the imported goods at the address where it was installed. 4.3. The appellant thereafter preferred an appeal against the order dated 28.12.2001 before the CESTAT, which set aside the order of the CIT (Appeals) and remanded the matter back to decide the same on merits. It appears that while remanding the matter, the CESTAT recorded about the letter dated 18.01.2002 of the licensing authority whereby it has regularized the installation of the imported goods. 4.4. Upon matter being remanded, the CIT (Appeals) appears to have done physical ve....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e registered premises is not in dispute and hence in view of the amendment in the original Notification No. 110/95-Cus dated 05.06.1995, the case of the petitioner will get encompass and hence the petitioner is entitled for full duty exemption. 6. Opposing the aforesaid submissions, learned Senior Standing Counsel Mr. Maunil Yajnik appearing for learned Senior Standing Counsel Mr. C.B. Gupta for the respondent has submitted that since there are concurrent findings, it is urged that the Court may not interfere with, more particularly, in wake of the fact that the petitioner has violated condition no. 6 of the Notification No. 110/95-Cus dated 05.06.1995. It is submitted that the petitioner was supposed to install the goods in the factory premises and instead he had installed the same at the testing laboratory which is not in the registered factory premises. Thereafter, the competent authority had issued show cause notice dated 26.05.1999 calling upon the petitioner as to why duty amounting to Rs. 4,93,883/- shall not be confirmed and collected. It is contended that the Bills of Entry is dated 22.07.1995 and Notification No. 110/95-Cus is dated 05.06.1995 and pursuant to it the pe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....onfirmed and collected. The said show cause notice ultimately culminated into impugned orders as mentioned herein-above. The case of the respective parties hinges only on two notifications as mentioned herein-above i.e. Notification No. 110/95 dated 05.06.1995 and Notification No.42/98-Cus dated 30.06.1998, more particularly Condition no. 6 of the Notification No. 110/95/Cus dated 05.06.1995 reads as under:- "(6) The capital goods imported, assembled or manufactured are installed in the importer's factory and a certificate from the jurisdictional Assistant Commissioner of Central Excise is produced within six months from the date of completion of imports or within such extended period as the said Assistant Commissioner of Customs may allow." 9. Thus, as per the issuance of the Notification No. 110/95-Cus dated 05.06.1995 the petitioner was supposed to install the machinery in importer's factory i.e., at its factory which the petitioner did not do so. However, subsequently the said notification has been amended vide Notification No. 42/98/Cus dated 30.06.1998 and the amended condition no. 6 reads as under : 1. Notification No. 110/95-Cus dated 06.06.1995 - In th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ly, "Tuticorin and Vishakhapatnam" had been substituted by the words "Tuticorin, Vishakhapatnam and Kakinada. Similarly the last two words, namely, Ludhiana and Hyderabad" in the category of inland container depot had been substituted by the words "Ludhiana, Hyderabad, Nagpur, Agra, Faridabad, Jaipur, Guntur and Varanasi. It, therefore, cannot be said to be a case where some other seaports or inland container depots have been added for the purpose of extension of the benefit but the newly added seaports or inland container depots had been made a part of the original notification. The Union of India while making a subordinate legislation had advisedly used the word "substitution" in place of the word "addition". The object and purport of the subsequent notification issued by the Union of India was, thus, to grant the same benefit which had been granted to the exporters who were registered at the other seaports, airports or inland container depots as specified in the notification dated 7.4.1997 but also to those exporters, who had been exporting from such seaports or inland depots as specified in the amended notification dated 27.11.1997. 23. If the Central Government intend....
X X X X Extracts X X X X
X X X X Extracts X X X X
....urdity occurring in the first amendment and bring the same in conformity with what the legislature really intended to provide was removed, stating : "23. The text of Section 2 of the Second Amendment Act provides for the word "upto" being substituted for the word "after". What is the meaning and effect of the expression employed therein - "shall be substituted"? 24. The substitution of one text for the other pre- existing text is one of the known and well-recognised practices employed in legislative drafting. 'Substitution' has to be distinguished from 'supersession' or a mere repeal of an existing provision. 25. Substitution of a provision results in repeal of the earlier provision and its replacement by the new provision (See Principles of Statutory Interpretation, ibid, p.565). If any authority is needed in support of the proposition, it is to be found in West U.P. Sugar Mills Assn. v. State of U.P., State of Rajasthan v. Mangilal Pindwal, Koteswar Vittal Kamath v. K. Rangappa Baliga and Co. and A.L.V.R.S.T. Veerappa Chettiar v. S. Michael. In West U.P. Sugar Mills Association case a three-Judges Bench of this Court held that the State Government by su....
X X X X Extracts X X X X
X X X X Extracts X X X X
....or 'premises' vide Notification No. 42/98-Cus dated 30.06.1998. The intention of the legislature does not appear to be that the benefit accruing from the Notification No.42/98-Cus dated 30.06.1998 would only be prospective in nature as the notification nowhere mentions that the same will apply prospectively only. 12. Thus, as held by the Apex Court in the aforesaid decision once the party is held eligible for obtaining the benefits of the amended notification being an exemption notification it should receive beneficial construction and it would be highly unfair if the benefit to such importer is taken away and if that be so, the intention of the statute would have been expressly worded that it has to be given only a prospective effect. The Apex Court has categorically held that where a statute is passed for the purpose of supplying an obvious omission in a former statute, the subsequent statute relates back to the time when prior Act was passed. Thus, it appears that there was a clear omission in the Notification No. 110/95-Cus dated 05.06.1995 by not introducing the word 'premises', but the same has been introduced and substituted in condition no. 6. Hence, we are of the opinio....