Case Note & Summary
The appellant, M/s. Shree Rajasthan Texchem Limited, a manufacturer of yarn, imported capital goods (textile machinery) under bills of entry dated 28th September 1995 and 31st October 1995. They claimed exemption from customs duty in excess of 15% and whole of additional duties of excise under Customs Notification No.110/95-Cus dated 5th June 1995. The Assistant Commissioner of Customs assessed the goods, including Cess levied under Section 5 of the Textile Committees Act, 1963 as part of the additional duty of excise (CVD) under Section 3 of the Customs Tariff Act, 1975. The appellant contested this inclusion before the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), which rejected their appeal. The appellant then filed the present appeal before the Bombay High Court. The sole legal issue was whether the Cess under the Textile Committees Act is includable as a component of CVD. The appellant argued that the Cess is not a duty of excise and therefore should not be included in CVD for the purpose of exemption. The respondents, Union of India and others, supported the Tribunal's decision. The High Court, after hearing both sides, held that the Cess under Section 5 of the Textile Committees Act is not a duty of excise and thus cannot be included in the additional duty of excise under Section 3 of the Customs Tariff Act. Consequently, the appeal was dismissed, affirming the Tribunal's order.
Headnote
A) Customs Law - Countervailing Duty - Includability of Cess - Section 3 of Customs Tariff Act, 1975 read with Section 5 of Textile Committees Act, 1963 - The issue was whether Cess under the Textile Committees Act is part of additional duty of excise for CVD purposes - The Court held that Cess is not a duty of excise and thus not includable in CVD - The appeal was dismissed (Paras 2-5).
Issue of Consideration
Whether Cess levied under Section 5 of the Textile Committees Act, 1963 is includable as a component of Countervailing Duty (CVD) under Section 3 of the Customs Tariff Act, 1975?
Final Decision
Appeal dismissed. The Cess under Section 5 of the Textile Committees Act, 1963 is not includable as a component of Countervailing Duty under Section 3 of the Customs Tariff Act, 1975.
Law Points
- Cess under Textile Committees Act
- 1963 is not includable in CVD under Section 3 of Customs Tariff Act
- 1975
- Customs duty exemption notification interpretation
- Additional duty of excise
