Dismissed

Alstom T & D India Limited v. Assistant Commissioner

Madras HC3 Nov 2015WP/8959/2015

Case brief

AI extract

What is this about?

This court dismissed the writ petition against the Assistant Commissioner for reclaiming differential customs duty. The court ruled that the petitioner's valid alternative remedy of appealing to the appellate authority barred the writ petition, without examining the merits of the reclassification or jurisdictional claims.

What did the court decide?

None granted; petitioner directed to approach appellate authority.

Alstom T & D India Limited Vs Assistant Commissioner — Customs and Excise | Madras HC (2015)

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IN THE HIGH COURT OF JUDICATURE AT MADRAS

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RESERVED ON : 16.04.2015 DATE OF DECISION : 03.11.2015

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CORAM

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THE HONOURABLE MR.JUSTICE T.RAJA

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W.P.No.8959 of 2015

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Alstom T & D India Limited 19/1 GST Road Pallavaram Chennai 600 043 Represented by its Senior Manager (Indirect Taxation) Mr.S.Sivaramakrishnan

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.. Petitioner -vs-

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Assistant Commissioner Large Tax Payer Unit Government of India Ministry of Finance No.1775 Jawaharlal Nehru Inner Ring Road Anna Nagar Western Extension Chennai 600 101

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.. Respondent

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Petition under Article 226 of the Constitution of India, praying for the issue of a Writ of Certiorarified Mandamus, calling for the records on the file of the respondent in proceedings in C.No.VIII/06/01/2014 LTG V in Order in Original No.LTUC/31/2015-AC dated 23.01.2015 and to quash the same and direct the respondent to issue the certificate required under Customs Notification No.25/99 dated 28.02.1999, for import of Parts of Relays.

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For Petitioner :: Mr.Joseph Prabakar

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For Respondent :: Mr.A.P.Srinivas Senior Standing Counsel ORDER

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The present writ petition is directed against the Order-inOriginal No.LTUC/31/2015-AC dated 23.01.2015 passed by the Assistant Commissioner of Large Tax Payer Unit, Anna Nagar Western Extension, Chennai, which is appealable before the Commissioner of Central Excise (Appeals) within sixty days from the date of receipt of the communication, on deposit of the

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penalty levied and duty demanded therein and produce proof of such payment along with the appeal. The impugned order further shows that the appeal against the order shall lie before the Commissioner (Appeals) on payment of 7.5% of the duty demanded where duty or duty and penalty are in dispute, or penalty where penalty alone is in dispute.

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The Assistant Commissioner, the respondent herein in the impugned order, while reclassifying the Micom Px40 range of products (IEDs) as “Automatic Regulating or Controlling Instruments and Apparatus” under Customs Chapter Sub Heading 90328910, however, has not revoked the registration certificate Sl.No.1/2008/LTG-V dated 16.9.2008 by denying the exemption of customs duty under Notification No.25/99-Cus., dated 28.2.99 read with Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996 for the import of parts made for the manufacture of Px40 Micom range of products for the entire period covered under the show cause notice dated 4.12.2014. Finally in the impugned order, the respondent has confirmed the demand of customs duty of Rs.21,99,45,177/- and also charged interest on the above said customs duty under Section 28AA of the Customs Act along with penalty of Rs.21,99,45,177/- under Section 114A of the Customs Act, making it clear that the penalty would be reduced to 25% if the duty, interest and penalty are paid within 30 days of receipt of the order.

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Mr.Joseph Prabakar, learned counsel for the petitioner submitted that the petitioner is engaged in the manufacture of various electrical equipments like transformers, circuit breakers, control panels, relays, etc., in its various factories situated in several parts of the country and registered as a large tax payer unit (LTU) at Chennai. It is also stated that the petitioner company is importing parts of relay falling under Customs Chapter Heading 85 36 under concessional rate of duty by availing exemption under Serial No.112 of Customs Notification No.25/99 dated 28.2.99. While so, in terms of Serial No.112 referred to above, exemption is provided for import of parts required for manufacture of relay, therefore, the petitioner had obtained registration under the Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996 from time to time including under Registration Certificate S.No.1/2008/LTG-V dated 16.9.2008. When the petitioner has been importing parts of relay for the manufacture of relay in their factory at Pallavaram, Chennai for several years, the respondent, raising queries as to whether the final product manufactured by the petitioner would fall under the classification of relay, sought for certain particulars, hence, the petitioner furnished the required documents to the respondent satisfying the query on relay. Subsequently, when the petitioner requested for issuance of certificate required

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under the Customs Notification No.25/99 dated 28.2.99 and enclosed Annexure III vide their letter dated 1.4.2014, the respondent, instead of issuing the certificate, asked the petitioner to explain as to (i) why items declared and cleared as relays under chapter heading 85 36 should not be reclassified under sub heading 9032 8990, (ii) why the items imported should not be classified as parts of automation apparatus under Central Excise Tariff heading 9032 9000, (iii) why the permission granted for import of competence under concessional rate of duty as per Customs Notification No.25/99 dated 28.2.99, should not be denied, as the components imported as well as the final product manufactured appear to fall under different chapter headings other than those specified in the notification and (iv) why the differential customs duty on the goods imported under concessional rate of duty under bond should not be demanded along with interest, for which the petitioner sent a detailed letter dated 1.4.2014 explaining the factual position about the product manufactured by the petitioner, specifically clarifying that they are manufacturing only two items, namely, P40 and P44T which are nothing but relays and confirmed that products like MU Agile AMU, DAP server etc., do not qualify as relays. Subsequently, the petitioner also appeared before the respondent on 4.4.2014 and 10.4.2014 with the technical officers and their counsel and explained their case that the product manufactured by them are only relays and they are eligible for claiming the benefit under Customs Notification No.25/99 and thereupon requested the respondent to issue the certificate for HA/HAMIDOS range of relays. But the respondent rejected their request on 6.5.2014.

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Aggrieved by the same, the petitioner came to this Court by filing W.P.No.13900 of 2014. This Court, by order dated 14.10.2014, directed the respondent to decide the issue after providing the relied on documents to the petitioner. Pursuant thereto, the respondent issued the show cause notice dated 4.12.2014 and demanded the differential customs duty for 12 years, namely, from August, 2002 to March, 2014 for two types of relays viz., HA/HA-MIDOS range of relays and MICOM range of relays. Adding further, the learned counsel submitted that the petitioner, having filed the reply dated 22.12.2014, appeared personally on 14.1.2015 raising several grounds. But the respondent has passed the impugned order, which is non-speaking, ignoring the fact that the respondent cannot demand differential customs duty under the Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996 and has no jurisdiction to demand differential customs duty beyond one year from the date of show cause notice. Therefore, the learned counsel submitted that the impugned order is liable to be set aside.

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Prima facie, the impugned order is appealable before the Commissioner of Central Excise (Appeals), Chennai. In view of the settled legal position that the availability of alternative remedy would be a clear bar for approaching this Court under Article 226 of the Constitution of India, this Court could see that only for the purpose of avoiding the pre-deposit of 7.5% of the duty demanded, the petitioner has filed the present writ petition on the ground that the issues are covered. But still the issues as to whether the respondent can demand differential customs duty under the Customs (Import of Goods at Concessional Rate of Duty for Manufacture of Excisable Goods) Rules, 1996 and whether the respondent has got jurisdiction to demand differential customs duty beyond one year from the date of show cause notice are to be decided only by the appellate authority, but not by this Court. The second contention raised by the petitioner that the impugned order is a non-speaking order is also not acceptable. In any event, this Court is not inclined to entertain the writ petition, as the petitioner has to challenge the impugned order only before the appellate Commissioner. Since the writ petition is filed before this Court within sixty days, the petitioner is permitted to approach the appellate authority within sixty days from the date of receipt of a copy of this order. 6. With the above direction, the writ petition stands dismissed without going into the merits. Consequently, M.P.No.1 of 2015 is also dismissed. No costs. Sd/Assistant Registrar(CS III) //True Copy// Sub Assistant Registrar ss To 1. The Assistant Commissioner Large Tax Payer Unit Government of India Ministry of Finance No.1775 Jawaharlal Nehru Inner Ring Road Anna Nagar Western Extension Chennai 600 101 + 1 cc to M/s.Joseph Prabakar, Advocate SR.60260 W.P.No.8959 of 2015 PPA(CO) EU 14.12.15

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Alstom T & D India Limited v. Assistant Commissioner

Case brief

What is this about?

What did the court decide?

Alstom T & D India Limited v. Assistant Commissioner

Case brief

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