2021-TIOL-712-HC-TRIPURA-CX

UoI Vs Dharampal Satyapal Ltd

CX - Revenue is aggrieved by the order passed by the CESTAT - The substantial question of law involved in this appeal is whether the CESTAT was right in law in interpreting provisions of Rule 6(1) and 6(4) of the CCR, 2004 and thereby giving benefit of exemption notifications in favour of the respondent-assessee, ignoring the contention of the appellants that the final product being exempt from payment of basic duties, the assessee was not entitled to claim the benefit of the notification dated 09.07.2004 as amended from time to time?.

Held: Question is whether the final product manufactured and cleared by the assessee can be stated to be an exempt goods - As per definition in terms of rule 2(d) of CCR, "exempted goods" means excisable goods which are exempt from whole of the duty of excise and includes goods which are chargeable to "Nil" rate of duty - In the context of these statutory provisions, the Tribunal was of the opinion that the exemption from payment of excise duty and other duties under the Notification dated 21.01.2004 as amended by later Notification dated 09.07.2004, was not an unconditional exemption; that though the basic duty of excise was exempt on the final product, other duties such as National Calamity Contingent duty and Education Cess were applicable, therefore, the term exempted goods for the purpose of Rule 6(1) would cover only those goods which are exempt from all kinds of excise duties - Exemption Notification 8/2004-CX dated 21.01.2004 cannot be seen as an un-conditional exemption Notification in the nature of the Government of India forgoing certain duties - The Notification appears to have a dual purpose in the mind of the authority - First was to encourage investment in manufacturing units of specified products in the North-Eastern States - The second purpose also is equally important namely, that the element of duty waived by the Government of India is also ploughed back into the region by augmenting the manufacturing capability of a unit in the said region or for other purposes such as development of infrastructure or civil works or social projects in the region - The amount of duties saved by the manufacturer thus under this Notification, was to be utilized in a specified manner - The additional condition was that any such investment so made as required under the Notification would not be withdrawn before completion of a period of 10 years and the breach of the condition would result into the recovery of duties forgone - The term "exempted goods" as defined in Rule 2(d) of the said Rules, therefore, shall have to be interpreted in the context of the materials on record and the observations of the Supreme Court in case of Pine Chemicals ( (1995) 1 SCC 58 ) - As per Rule 2(d), "exempted goods" would mean excisable goods which are exempt from the whole of the duty of excise leviable thereon or the goods which are chargeable to "Nil" rate of duty - In the present case, Bench has held that the exemption Notification dated 21.01.2004 as amended subsequently cannot be seen as a Notification granting unconditional exemption from payment of duties - Such exemption was conditional on various requirements which limited the scope of the assessee to utilize the duty element so exempted, for any purpose at all - Such exemption, thus, did not directly increase the profitability of the product since the assessee could not retain the sum equivalent to the duty payable and utilized it at will - Question answered against the revenue and in favour of the assessee - Both appeals dismissed: High Court [para 10, 12, 14, 16]

Appeals dismissed : TRIPURA HIGH COURT

2021-TIOL-711-HC-MAD-CUS

Quantum Coal Energy Pvt Ltd Vs Commissioner

Cus - Petitioner submits that the Supreme Court in M/ s.Canon India Private Limited V. Commissioner of Customs = 2021-TIOL-123-SC-CUS-LB has held that the expression "the proper officer" occurring in Section 28 of the Customs Act will only refer to the assessing officer who passes the original order making assessment; that, therefore, show cause notice issued by the Additional Director General of DRI cannot be said to have been issued by "the proper officer".

Held: Since the entire proceedings were initiated by an authority who lacked the jurisdiction, applying the aforesaid decision of the Supreme Court, the order impugned in these writ petitions is quashed - The writ petitions are allowed: High Court [para 6, 7]