ORDER
G.P. Agarwal, Member (J)
1. This appeal is directed against the impugned order passed by the Colllector of Customs, Air Cargo Complex, Bombay denying the benefit of Notification No. 311/86 dated 13-5-1986.
2. A few facts necessary for the purpose of this appeal are that the appellants imported a Colour Scanner for their Printing Industry and got the Bill of Entry registered with the Contract Cell of Bombay Customs House for assessment under Project Imports under Chapter 98.01 of the Customs Tariff. On arrival of the goods the appellants claimed the benefit under Notification No. 132/85 dated 19-4-1985, which exempts goods falling under Heading No. 98.01 from a basic duty of Customs in excess of 30%. Simultaneously, the appellants also claimed benefit of Notification No. 311/86 dated 13-5-1986, which exempts goods from the whole of auxiliary duty of Customs provided, they are specified in Col. No. 3 of the Table. In the instant case Colour Scanner are specifically figuring under Sr. No. 46 against Chapter No. 90 of the Customs Tariff of the Table attached to the said Notification No. 311/86. It appears that the Collector of Customs, Bombay allowed the benefit of Notification No. 132/85 to the appellants but denied the benefit of Notification No. 311/86 dated 13-5-1986 by observing as follows –
“The question that arises is whether the importer can have the same goods assessed under two different Heading No. 98.01 and 90 of CTA for purposes ofbasic and auxiliary duty.
Such a benefit to the importer also gets barred by the proviso to Notification No. 132/85, which states that the goods referred to in this Notification (i.e. goods falling under Heading No. 98.01) can avail of exemption granted under any other notifications to such goods. Once the importers opt for assessment under heading 98.01, the goods i.e. ‘Colour Scanner’ go out of the scope of chapt. 90 and fall under 98.01. Hence Notification No. 311/86 dtd. 13-05-1986, which extends concession to ‘Colour Scanner’ falling under chapt. 90 will not apply.”
3. Arguing on behalf of the appellants Shri B.B. Gujral, learned counsel for the appellants submitted that under the law the importer can avail the benefit of more than one Exemption Notification and therefore, the Collector erred in law in denying the benefit of Notification No. 311/86 in respect of auxiliary duty. To buttress his argument he cited the following case law —
(1) Collector of Customs, Madras v. Bharat Heavy Electricals Ltd., – 1987(31) ELT 534 (Tri.)
(2) Chowgule Matrix Hobs Ltd. v. Collector of Customs, 1987 (31) ELT 736(Tri.)
(3) Auto Tractors Ltd. v. Collector of Customs, -1989 (39) ELT 494.
In reply Shri K. Kumar, learned SDR supported the impugned order by reiterating the reasonings given in the impugned order.
4. We have considered the submissions made by the parties and find that the contentions raised by the learned counsel for the appellants have no force. There cannot be any quarrel with the proposition that there is no bar in law to availing of more than one benefit under the Exemption Notifications unless it is barred categorically as held by this Tribunal in the case of Collector of Customs, Madras v. Bharat Heavy Electricals Ltd., supra and followed in Chowgule Matrix Hobs Ltd. v. Collector of Customs, supra. Likewise there cannot be any quarrel with the proposition that a party has a right to avail the benefit of any notification which provides larger relief than the one available under the other notification as held by the Hon’ble Supreme Court in the case of Auto Tractors Ltd. v. Collector of Customs supra. However, in the instant case the said case law is not apt to the controversy in hand. For, it is not the case of the appellants, that they want to avail the benefit of Notification No. 311/86 dated 13-5-1986 (in respect of auxiliary duty) in preference to the benefit available under Notification No. 132/85 dated 19-4-1985. Their claim is that they are entitled for the benefit of both the said notifications. Thus, the question is as to whether after getting their Bill of Entry registered in the Contract Cell, Bombay Customs House for availing the benefit of assessment under Project Imports under Chapter 98.01 of the Customs Tariff from a basic duty of Customs in excess of 30%, the appellants can claim the benefit of Notification No. 311/86 in respect of auxiliary duty also.
5. It is not in dispute that the appellants opted for assessment under Heading 98.01 on their imported goods and got the benefit of Notification No. 132/85 dated 19-4-1985. This classification of their imported goods under Heading 98.01 was not challenged before us. Hence we are not called upon to decide whether the imported goods, i.e. ‘Colour Scanner’ fall under Heading 98,01 or Chapter 90 and the limited question before us is as to whether the appellants as stated above is also entitled for the benefit of Notification No. 311/86 which relates to auxiliary duty. Notification No. 132/85-Cus. dated 19-4-1985 exempts the goods falling under the Heading 98.01 (in the instant case Colour Scanner) when imported into India for the Project from a basic duty of Customs in excess of 30%, and its proviso further provides that nothing contained in this notification shall affect the exemption granted under any other notification of the Government of India for the time being in force from the duty of customs specified in the said First Schedule in respect of the goods referred to in this notification. From this proviso it is clear that the “goods referred to in this notification” means the “goods falling under Heading No. 98.01.” Notification No. 311/86 exempts goods from the whole of auxiliary duty of Customs specified in Col. 3 of the Table annexed thereto and falling within the Chapter or Chapters of the First Schedule to the Customs Tariff Act, 1975 specified in the corresponding entry in Col. No. 2 of the said Table when imported into India. In the instant case the imported goods, i.e. ‘Colour Scanner’ are specifically figuring at Sr. No. 46 of the said Table against Chapter No. 90/CTA in Col. No. 2 of the said Table. From this it is clear that to claim the benefit in respect of auxiliary duty under Notification No. 311/86 the imported goods must fall under Chapter No. 90/CTA as provided in Col. 2 at Sr. No. 46 of the said Table attached to Notification No. 311/86. As stated above according to the appellants themselves they have opted for assessment of the imported goods under Heading 98.01, thus, in our considered opinion, cannot be allowed to say that for the purpose of Notification No. 311/86 the subject goods so imported should be classified under different head i.e. under Chapter 90. In other words, there cannot be and should not be two classifications under different heads of the same goods. Thus, we agree with the findings of the lower authority that once the appellants opt for assessment under Heading 98.01 the subject goods, i.e. Colour Scanner go out of the scope of Chapter 90 and therefore, the appellants cannot claim the benefit of Notification No. 311/86 in respect of auxiliary duty.
6. In the result we affirm the impugned order and reject the appeal being devoid of any merits.
K. Prakash Anand, Member(T)
7. I have given my best consideration to the order passed by my learned brother Shri G.P. Agarwal. With respect, I am unable to agree for the reasons which are given in the following paras.
8. The appellants have availed of the benefit of Notification No. 132/85 dated 19-4-1985. This notification exempts goods falling under Heading No. 98.01 from the basic duty of Customs in excess of 30%. Heading No. 98.01 is for all items of what is broadly termed as project imports i.e. items of machinery etc. required for the initial setting up of a unit or the substantial expansion of an existing unit of a specified industrial plant, irrigation project, power project, mining project, project for the exploration for oil or other minerals and such other projects as the Central Government may notify including spare parts and other raw materials as indicated for the maintenance of the plants or project. So, here is a notification in regard to the basic Customs duty for items of project import. There is no dispute that the goods imported in this case have been brought in as an item of a project import and they have been classified under 98.01 for purposes of basic Customs duty. Now, what about auxiliary duty of Customs ? As per Clause 49 of the Finance Bill, 1986, in the case of goods mentioned in the First Schedule to the Customs Tariff Act, or in that Schedule, as amended from time to time, there shall be levied and collected as an auxiliary duty of Customs an amount equal to 50% of the value of the goods as determined in accordance with the provisions of Section 14 of the Customs Act, 1962. These auxiliary duties of Customs are in addition to any duties of Customs charged on such goods under the Customs Act or any other law for the time being in force.
9. For determining the auxiliary duty so payable, we have to take into account the exemption Notification No. 311/86-Cus. dated 13-5-1986, which exempts the goods specified in Column 3 of the Table annexed to the notification and falling within the Chapter or Chapters of the First Schedule to the Customs Tariff Act, 1975, specified in the corresponding entry in column (2) of the said Table, when imported into India, from the whole of the auxiliary duty leviable thereon under Sub-section 1 of Section 49 of the said Finance Bill. The relevant entry, the benefit of which is claimed by the appellant is extracted below:-
THE TABLE S1. Chapter of the First Schedule to the Description of goods No. Customs Tariff Act, 1975 XX XXXXXXXXX XXXXXX XX XXXXXXXXX XXXXXX XX XXXXXXXXX XXXXXX 46. 90 Colour Scanner.
10. The item imported here is ‘Colour Scanner’ and is fully covered by the relevant entry of Notification No. 311/86-Cus. In the view taken by Shri Agarwal, if an importer is charged to basic customs duty on an item of import under Heading 98.01, he is excluded from the benefit of the exemption notification relating to auxiliary duty. This view, to my mind, is not valid in law. While the basic duty is determinable by classification under Tariff Heading 98.01, read with any notification issued thereunder, when it comes to determination of auxiliary duty under Clause 49 of the Finance Bill 1986, this has to be done alongwith the relevant notifications issued thereunder. The imported goods, namely, the colour scanner are clearly referred to as falling under Chapter 90 of the First Schedule to the Customs Tariff Act, 1975 and a total exemption of auxiliary duty has been given. The fact that for purposes of basic duty, the goods have had the benefit of classification as project imports under Heading 98.01 is no bar to the benefit of Notification No. 311/86. The two classifications sought are for two separate purposes; one is the basic Customs duty, and the other is the auxiliary duty, and the Tariff itself provides for this distinction.
11. In the light of this discussion, I set aside the impugned order and allow the appeal.
12. In view of the separate orders recorded by the two Members, the following point of difference has arisen :-
“Whether the imported goods, namely, colour scanner, assessed to basic Customs duty under project imports under Chapter 98.01 of the Customs Tariff would be entitled to the benefit of Notification No. 311/86-Cus. dated 13-5-1986, which exempts goods from the whole of auxiliary duty of Customs, provided they are specified in Column 3 of the Table and fall within the Chapter or Chapters of the First Schedule of the Customs Tariff Act, 1975 specified in the corresponding entry in Column (2) of the said Table”.
G. Sankaran, President
13. I have heard Shri B.B. Gujral, learned Advocate for the appellants and ShriM.K. Sohal, learned DR for the respondent.
14. The facts of the case have been set out in the order recorded by learned Member, Shri G.P. Agarwal and do not need to be repeated.
15. Learned Counsel for the appellant draws my attention to statutory note 1to Chapter 98 which reads as follows :-
“This chapter is to be taken to apply to all goods which satisfy the conditions prescribed therein, even though they may be covered by a more specific heading elsewhere in this Schedule.”
The submission is that though an article may fall under a specific heading, it would also fall under the relevant heading in Chapter 98 if the conditions laid down in the relevant heading are satisfied. Colour scanner falls under Chapter 90, and is exempt from the whole of the auxiliary duty of customs in terms of customs Notification No. 311/86, dated 13-5-1986. Since, in the present instance, it has been imported in accordance with conditions set out in Heading No. 98.01, it was assessed to basic customs duty under that heading read with customs Notification No. 132/85, dated 19-4-1985. But that would not mean the article would be debarred from the benefit of full exemption from auxiliary duty in terms of Notification No. 311/86. The two notifications are independent of each other and there is no clause in either of them which would debar an article from getting a benefit of one notification if the benefit of the other notification is also claimed. In this connection, Shri Gujral relies on the three decisions referred to in para 3 of Shri Aggarwal’s order as also on the following decisions :-
1. Tamil Nadu Newsprint and Papers Ltd. v. Union of India and Ors. -1988 (33) ELT 22 (Mad.);
2. Coromandile Prints and Chemicals Ltd. v. Collector of Central Excise -1990 (47) ELT 7 (Tribunal);
3. Indoswe Engineers Pvt. Ltd. v. Union of India – (1990) 26 ECC 266 (Bom) .
16. In reply, the learned Departmental Representative submits that once the appellant has chosen to seek classification under Heading 98.01, he foregoes the option of having the goods assessed on its own merits under Chapter 90. The importer could well have chosen classification on merits in which case he would have been entitled to exemption from auxiliary duty. Once a project contract is registered in the Custom House and goods are classified under Heading 98.01, the identity of the goods is lost and classification on merits is not permissible. It is also not permissible to classify the same goods under one heading for the purpose of basic customs duty and another for the purpose of auxiliary duty of customs. In the present instance, though there is no dispute regarding the class if ability of colour scanner on its merits under Chapter 90, the benefit of that classification cannot be extended since the goods already stand classified under Heading 98.01 at the instance of the appellant. In this connection Shri Sohal, learned Departmental Representative, relies on the Supreme Court judgment in the case of Hemraj Govardhandas v. Assistant Collector of Customs, Sitrat and Ors. -1978 (2) ELT(J.350). The submission is that though there is no specific bar in Notification No. 311/86 to the simultaneous availment of the benefit of Heading 98.01 read with Notification No. 132/85, the bar is implicit because the benefit of notification No. 311/86 will be available only if the goods are classified under Chapter 90. In the present case, classification under Chapter 90 is to be ruled out because of the goods having been classified under Heading 98.01 at the instance of the appellant. If any relief in auxiliary duty is to be extended in the present case, it is to be in terms of any notification issued in relation to Heading 98.01. But there is no such notification and therefore, the goods would be chargeable to the standard rate of auxiliary duty, namely, 50% ad valorem.
17. I have carefully considered the submissions before me. I propose to consider the issue first on first principles. As is clear from Heading 98.01 read with chapter note No. 1 to 98, the scheme of the tariff envisages that goods which may be covered by a more specific heading elsewhere in the Schedule would also be classifiable under Heading 98.01 provided the conditions stipulated therein are satisfied. The First Schedule to the Customs Tariff Act, 1975 is for the purpose of determination of the classification and the rate of duty of customs applicable to imported goods in terms of Section 2 of the Act. This duty is commonly known as basic customs duty. There are several other duties of customs one of them being auxiliary duty of customs, the authority for which flows from the Annual Finance Acts, the Finance Act of 1986 being relevant in the present instance. Notification No. 132/85, dated 19-4-1985 exempts goods falling under Heading 98.01 of the aforesaid Schedule, when imported into India for industrial plants or project other than power projects including gas turbine power projects and fertilisers projects, from so much of that portion of the duty of customs leviable there on which is specified in the said Schedule, as is in excess of the amount calculated @ 30% ad valorem. It is, thus, clear that the exemption is from a portion of the duty leviable under the First Schedule i.e. basic customs duty. This notification, on the face of it, has nothing to do whatsoever with regard to the levy and assessment of auxiliary duty of customs, the authority for which, as we have seen, flows not from the First Schedule to the Customs Tariff Act but from the Annual Finance Acts. This view gains support from para 2 of the notification which reads as follows :- “Nothing contained in this notification shall affect the exemption granted under any other notification of the Government of India for the time being in force from the duty of Customs specified in the said First Schedule in respect of the goods referred to in this notification.”
That is to say, Notification No. 132/85 will not in any way affect the exemption from basic customs duty conferred on an article by any other notification for the time being in force. Thus, Notification No. 132/85 does not derogate in any way from the application of another notification which may prescribe a rate of basic customs duty on an article lower than 30% ad valorem. When such is the case it is difficult to imagine how this notification would come in the way of the applicability of Notification No. 311/86, dated 13-5-1986 which has nothing to do with basic customs duty.
18. Notification No. 311/86 exempts inter alia colour scanner falling with in Chapter 90 of the First Schedule to the Customs Tariff Act, when imported into India, from the whole of the auxiliary duty of the Customs thereon under Sub-section 1 of Section 49 of Finance Act, 1986. There is no dispute that colour scanner, on its merits, falls within Chapter 90 of the Schedule. The notification is specific in respect of colour scanners. There is nothing in the notification which has the effect of debarring colour scanner imported under the Project Imports Regulation, from the benefit of exemption from auxiliary duty of Customs on the ground that it is classified under Heading No. 98.01 of the First Schedule for the purpose of levy of basic customs duty under the said First Schedule read with any notification for the time being in force. To my mind, it is obvious that the fact that the classification of the imported colour scanner has been fixed as Heading 98.01 for the purpose of basic customs duty does not have the effect of debarring it from the benefit of exemption from auxiliary duty of customs in terms of Notification No. 311/86.
19. Now I shall turn to the case law cited before me. Of the several decisions cited, the Madras High Court judgment in the case of Tamil Nadu Newsprint and Papers Ltd., Madras is the most appropriate one because the issue therein was similar to the one in the present dispute. The petitioner therein imported certain items of paper making machinery and component parts thereof falling under Heading No. 84.31. The goods were imported pursuant to specific contract registered under Heading 84.66 (predecessor to Heading 98.01). In view of this, the Revenue denied the benefit of exemption from auxiliary duty of customs in terms of Notification No. 62/83 applicable to paper making machinery and component parts thereof falling under Heading 84.31 for the same reason as advanced in the present case. Paras 6,7, and 8 of the judgment which are relevant in this context are reproduced below :-
“6. In this connection, learned counsel for the petitioner also laid stress on the Rules for Interpretation of the First Schedule to the Act and in particular clause 3 thereof which reads as follows :
“3. When for any reason, goods a re prima facie classifiable under two or more Headings, classification shall be effected as follows :
(a) The Heading which provides the most specific description shall be preferred to Headings providing a more general description.”
Merely because “Paper making machinery and component parts there of coming under Heading 84.31 and covered by Notification No. 62/83 would also come within the general Heading 84.66 covered by Notification No. 61/83, it is not possible to deny the petitioner the benefit of the exemption accorded in Notification No. 62/83. The principles discussed above amply and forcibly support the case of the petitioner. The rule general is special bus non derogant should apply to the present case.
7. Even” on the second principle urged by the learned counsel for the petitioner covering reliefs at the hands of this Court, I find that the case of the petitioner stands on a strong footing. The Notification 62/83 is unambiguous and it specifically refers to “paper making machinery and component parts there of coming within Heading 84.31 without any exclusion on the ground the said items namely “paper making machinery and component parts thereof could also come within the ambit of the general Heading 84.66. Even assuming that there is any ambiguity and conflict between the two notifications, I am obliged to apply the principle that any ambiguity in the matter of construction of fiscal law should be resolved in favour of the tax payer rather than the Revenue.
8. It is well-settled rule that on the question of exemption in a fiscal law though a strict construction should be applied, yet what is expressly granted shall not be denied to the tax-payer by falling back upon some other provision found elsewhere. The exempting provisions must always be regarded as paramount. At the risk of repetition, it must be stated that Notification No. 62/83 is specific and has clearly given the exemption with reference to “paper making machinery and component parts thereof falling under Heading 84.31, without any exclusion expressed on the ground that it could also come within the general Heading 84.66. Maxwell on the interpretation of Statutes, Twelfth Edition, page 256 quotes the observations of Rowlatt, J. that “In a Taxing Act, one has to look merely at what is clearly said : there is no room for any intendment; there is no equity about a tax; there is no presumption as to a tax; nothing is to be read in; nothing is to be implied; one can only look fairly at the language used.”
20. It seems unnecessary to refer to any other case law. However, I shall briefly touch upon them. In Collector of Customs, Madras v. Bharat Heavy Electricals Ltd. 1987 (31) ELT 534 (Tribunal), the Tribunal held that there is no bar to availment of more than one benefit unless it is barred categorically.The dispute in that case was regarding the simultaneous availment of the benefit of lower rate of duty applicable to goods imported under Project Import Regulation and a notification fixing a lower rate of duty for certain goods. This decision was followed in Chvwgide Matrix Hobs Ltd. v. Collector of Customs, 1987 (31) ELT 736 (Tribunal). In that case also it was held that the Collector was in error in considering that the imports having been effected with reference to Project Import Regulations as covered by Heading No. 84.66, which gave concession to the importers, the appellants were not further entitled to the benefit of another concessional notification, since there was no expressed or implied restriction in the said notification. The Supreme Court judgment in Auto Tractors Ltd. v. Collector of Customs (Appeals) 1989 (39) ELT 494 is not, in my opinion, directly relevant to the present dispute because no question of simultaneous availment of the benefit of two notifications was in issue therein. In the Tribunal’s decision in Coromandile Prints and Chemicals Ltd. v. Collector of Central Excise – 1990 (47) ELT 7 (Tribunal) it was held that availment of exemption under one notification would not itself disentitle a manufacturer from availment of exemption under another notification should the same be applicable to the goods in question if there was nothing in the notification expressly debarring such simultaneous availment. In the Bombay High Court’s judgment in Indoswe Engineers Pvt. Ltd. v. Union of India -(1990) 26 ECC 266 (Bom), it was held that unless a notification contains a specific condition that the benefit thereunder is barred if a benefit is taken under another provision or notification, the assessee could be entitled to both the benefits. In coming to this conclusion the decision of the Supreme Court in the case of Hemraj Govardhandas v. Assistant Collector of Customs, Surat and Ors. – 1978(2) ELT (J-350) was also considered.
21. Thus, whether the issue is considered from first principles or in the light of judicial pronouncements and decisions of this Tribunal, there is no doubt in the present case that the colour scanner imported was entitled to the benefit of full exemption from auxiliary duty of customs in terms of Notification No. 311/86, dated 13-5-1986, though it was assessed to basic customs duty under Project Imports under Heading 98.01 of the Customs Tariff Schedule. In this view of the matter, I agree with the order recorded by Shri K. Prakash Anand, Member (Technical).
ORDER
22. In view of the majority opinion the impugned order passed by the Collector of Customs denying the benefit of Notification No. 311/86 dated 13-5-1986 in respect of auxiliary duty is set aside and the appeal is allowed with consequential relief to the appellants, if any.