DELHI CLOTH AND GENERAL MILLS CO. LTD. AND ANR. versus UNION OF INDIA AND ANR.

Citation: [1996] SUPP. 6 S.C.R. 511 · Decided: 19-09-1996 · Supreme Court of India · Bench: S.P. BHARUCHA, K. VENKATASWAMI · Disposal: Dismissed
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Judgment (excerpt)

DELHI CLOTH AND GENERAL MILLS CO. LTD. AND ANR. 
A 
v. 
UNION OF INDIA AND ANR. 
SEPTEMBER 19, 1996 
[S.P. BHARUCHA AND K. VENKATASWAMI, JJ.] 
Customs Tariff Act: 
S. 3-Assessee imp01ting tyre cord grade wood plup from USA-Called 
upon to pay additional duty thereort--Cliallenged before the Assistant Collec-
B 
c 
tor and thereafter before the High Court, but without success-On appeal, 
held, where a like lllticle is not produced or manufactured in India additional 
duty is required to be levied on the imp01ted article on the basis of the excise 
duty leviable on the class or description of lllticles to which the imported 
article belongs-Articles not elsewhere described under the residuary entry 68 
fomz a class by themselves-Hence if a like article is not described in the D 
Tllliff, additional duty is leviable 011 the imported article upon the basis of 
the levy of excise duty under the provisions of Entry 68. 
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 3400 of 
1984. 
From the Judgment and Order dated 27.5.82 of the Rajasthan High 
Court in D.B.C.W.P. No. 1381 of 1990. 
H.K. Puri for the Appellants. 
E 
Joseph Vallappally and C.V. Subba Rao for the Respondents. 
F 
The following Order of the Court was delivered : 
A limited argument is addressed in this appeal that impugns the 
judgment and order of a Division Bench of the High Court of Rajasthan. 
The appellants manufacture tyre yarn cord and fabric for which 
purpose they import tyre cord grade woodpulp from the United States of 
America. The appellants were called upon to pay additional duty thereon 
under the provisions of Sections 3 of the Customs Tariff Act. 
G 
Among other contentions raised by the appellants was this : The said H 
511 
512 
SUPREME COURT REPORTS (1996) SUPP. 6 S.C.R. ~ 
A woodpulp was not produced or manufactured in India. Under the terms of 
Section 3 additional duty had, therefore, to be calculated on the basis of 
the excise duty that would be leviable on the class or description of a~ticle ~ 
to which the said woodpulp belonged. There was no entry in the Tariff that 
related to an article of the like of the said woodpulp. Entry -68, being a 
B residuary entry relating to no class or description of goods, did not apply. 
No additional duty was, therefore, leviable on the said woodpulp. 
c 
D 
E 
F 
G 
The said contention was rejected by the Assistant Collt:ctor and by 
the High Court in the writ petition filed by the appellants. 
It is the only contention raised before us. 
Section 3 of the Customs Tariff Act, so far as it is relevant, reads 
thus: 
"S. 3.- Levy of Additional Duty equal to Excise Duty : 
(1) Any article which is imported into India shall, in addition, be 
liable to a duty (hereinafter in this section referred to as the 
\ 
additional duty) equal to the excise duty for the time being leviable 
on a like article if produced or manufactured in India and if such 
excise duty on a like article is leviable at any percentage of its 
value, the additional duty to which the imported article shall so 
liable shall be calculated at that percentage of the value of the 
imported article. 
Explanation : In this Section, the expression 'the excise duty for 
the time being leviable on a like article if produced or manufac-
tured in india' means the excise duty for the time being in force 
which would be leviable on a like article if produced or manufac-
tured in India, or if a like article is not so produced or manufac-
tured, which would be leviable on the class or description of 
articles to which the imported article belongs, and where such duty 
is leviable at different rates, the highest duty," · 
It is the Explanation which is important. The expression "the excise 
duty for the time being leviable on the like article if produced or manufac-
tured in India used in the body of sub-section (1) is explained to mean the 
excise duty for the time being in force (a) which would be leviable on a 
H like article if produced or manufactured in Indian, or (b) if a like article 
DELHI CLOTII AND GEN. MILLS v. U.0.1. 
513 
is not produced or manufactured in India, the excise duty that would be A 
leviable on the class or description or articles to which the imported article 
belongs. 
Where a like article is not produced or manufactured in India 
additional duty is required to be levied on the imported article upon the 
basis of the excise duty that is leviable on the class or description of articles 
to which the imported article belong
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