COMMISSIONER OF CUSTOMS (IMPORT), MUMBAI versus M/S. DILIP KUMAR AND COMPANY & ORS.

Citation: [2018] 7 S.C.R. 1191 · Decided: 30-07-2018 · Supreme Court of India · Bench: RANJAN GOGOI · Disposal: Reference answered

Cited by 36 judgment(s) · cites 9 · see the full citation network in Lexace

Judgment (excerpt)

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COMMISSIONER OF CUSTOMS (IMPORT), MUMBAI
v.
M/S. DILIP KUMAR AND COMPANY & ORS.
(Civil Appeal No. 3327 of 2007)
JULY 30, 2018
[RANJAN GOGOI, N. V. RAMANA, R. BANUMATHI,
MOHAN M. SHANTANAGOUDAR AND
S. ABDUL NAZEER, JJ.]
Tax/Taxation:
Exemption Notification – Interpretation of – In case of
ambiguity in such Notification, whether the benefit of ambiguity
would go to assessee or Revenue – Held: Exemption Notification
should be interpreted strictly – The burden to prove the applicability
of the exemption Notification would be on the assessee – In case of
ambiguity, benefit of such ambiguity would go to Revenue and not
to assessee - *Sun Export case wherein it was held that benefit of
ambiguity would go to assessee is overruled.
Taxing statute and Exemption Notification – Interpretation of
– Held: There is distinction in interpreting a charging provision of
a taxation statute and in the interpretation of exemption Notification
– Any ambiguity in charging provision enures to the benefit of the
assessee, but any ambiguity in the exemption clause or exemption
Notification would go in favour of Revenue.
Interpretation of Statutes:
General principles of interpretation – Purpose of
interpretation – Tools of interpretation – Discussed.
Interpretation of fiscal statutes – Held: While interpreting
fiscal statutes court has to apply strict rule of interpretation.
‘Plain meaning rule’ of interpretation – Held: When language
in the statute is plain and unambiguous, Court has to seal and
understand the plain language as such, and there is no scope of
interpretation.
  [2018] 7 S.C.R. 1191
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SUPREME COURT REPORTS
[2018] 7 S.C.R.
‘Strict interpretation’ and ‘Literal interpretation’ – Distinction
between – Held: All cases of literal interpretation would involve
strict rule of interpretation, but strict rule may not necessarily
involve the former, especially in the area of taxation – Thus strict
interpretation does not encompass strict literalism into its fold.
Interpretation of taxing statute – Rule of interpretation – Held:
Every taxing statute including charging, computation and exemption
clause (at the threshold stage) should be interpreted strictly.
Contextual or purposive interpretation – Of taxing statutes –
Held: In a taxation statute there is no room for any intendment – In
taxation statutes contextual or purposive interpretation cannot be
applied – Nor any resort be made to look to other supporting
material – Equity has no place in interpreting a tax statute.
Answering the referred question, the Court
HELD: 1.1  An Act of Parliament/Legislature cannot foresee
all types of situations and all types of consequences.  It is for the
Court to see whether a particular case falls within the broad
principles of law enacted by the Legislature.  Here, the principles
of interpretation of statutes come in handy.  In spite of the fact
that experts in the field assist in drafting the Acts and Rules,
there are many occasions where the language used and the
phrases employed in the statute are not perfect. Therefore,
Judges and Courts need to interpret the words.  [Para 14]
[1206-D, E]
1.2  The principles of interpretation have been evolved in
common law.  It has also been the practice for the appropriate
legislative body to enact Interpretation Acts or General Clauses
Act.  In all the Acts and Regulations, made either by the Parliament
or Legislature, the words and phrases as defined in the General
Clauses Act and the principles of interpretation laid down in
General Clauses Act are to be necessarily kept in view.  If while
interpreting a Statutory law, any doubt arises as to the meaning
to be assigned to a word or a phrase or a clause used in an
enactment and such word, phrase or clause is not specifically
defined, it is legitimate and indeed mandatory to fall back on
General Clauses Act.  Notwithstanding this, when there is
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repugnancy or conflict as to the subject or context between the
General Clauses Act and a statutory provision which falls for
interpretation, the Court must necessarily refer to the provisions
of statute. [Para 15] [1206-F-H]
1.3 The purpose of interpretation is essentially to know
the intention of the Legislature.  Whether the Legislature intended
to apply the law in a given case; whether the Legislature intended
to exclude operation of law in a given case; whether Legislature
intended to give discretion to enforcing authority or to adjudicating
agency to app

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