M/S. UNICORN INDUSTRIES versus UNION OF INDIA & OTHERS

Citation: [2019] 17 S.C.R. 1013 · Decided: 06-12-2019 · Supreme Court of India · Bench: ARUN MISHRA, M.R. SHAH, BHUSHAN RAMKRISHNA GAVAI · Disposal: Dismissed

cites 5 · see the full citation network in Lexace

Judgment (excerpt)

A
B
C
D
E
F
G
H
1013
M/S. UNICORN INDUSTRIES
v.
UNION OF INDIA & OTHERS
(Civil Appeal No. 9237 of 2019)
  DECEMBER 6, 2019
[ARUN MISHRA, M. R. SHAH AND B. R. GAVAI, JJ.]
Central Excise Act, 1944 – Finance Act, 2004 – Finance Act,
2007 – Finance Act, 2001 – The High Court held that duties i.e.
the levy of education cess, higher education cess and National
Calamity Contingent Duty (NCCD) are not the part of the exemption
notification  – Appellant contended that the NCCD, education cess,
and secondary and higher education cess form part of the excise
duty and hence the decision of the High Court is bad in law – On
appeal, held: Notification dated 09.09.2003 issued in the present
case makes it clear that exemption was granted u/s. 5A of the Act
1944, concurring additional duties under the Act of 1957 and
additional duties of excise under the Act of 1978 – There was no
reference to the Finance Act, 2001 by which NCCD was imposed,
and the Finance Acts of 2004 and 2007 were not in vogue – The
notification could not have contemplated the inclusion of
education cess and secondary and higher education cess imposed
by the Finance Acts of 2004 and 2007 in the nature of the duty of
excise – In the absence of a notification containing an exemption
to such additional duties in the nature of education cess and
secondary and higher education cess, they cannot be said to have
been exempted  – The High Court rightly relied on the decision of
the three-Judge Bench of the Supreme Court in Modi Rubber Limited,
which was followed by another three-Judge in Rita Textiles Private
Limited – Therefore, the Judgment and order of the High Court
upheld.
Dismissing the appeals, the Court
HELD: 1. Notification dated 9.9.2003 issued in the present
case makes it clear that exemption was granted under Section
5A of the Act of 1944, concerning additional duties under the
Act of 1957 and additional duties of excise under the Act of 1978.
It was questioned on the ground that it provided for limited
   [2019] 17 S.C.R. 1013
1013
A
B
C
D
E
F
G
H
1014
SUPREME COURT REPORTS
[2019] 17 S.C.R.
exemption only under the Acts referred to therein. There is no
reference to the Finance Act, 2001 by which NCCD was
imposed, and the Finance Acts of 2004 and 2007 were not in
vogue.  The notification was questioned on the ground that it
should have included other duties also.  The notification could
not have contemplated the inclusion of education cess and
secondary and higher education cess imposed by the Finance
Acts of 2004 and 2007 in the nature of the duty of excise.  The
duty on NCCD, education cess and secondary and higher
education cess are in the nature of additional excise duty and it
would not mean that exemption notification dated 9.9.2003
covers them particularly when there is no reference to the
notification issued under the Finance Act, 2001.  There was no
question of granting exemption related to cess was not in vogue
at the relevant time imposed later on vide Section 91 of the Act
of 2004 and Section 126 of the Act of 2007.  The provisions of
Act of 1944 and the Rules made thereunder shall be applicable
to refund, and the exemption is only a reference to the source
of power to exempt the NCCD, education cess, secondary and
higher education cess.  A notification has to be issued for
providing exemption under the said source of power. In the
absence of a notification containing an exemption to such
additional duties in the nature of education cess and secondary
and higher education cess, they cannot be said to have been
exempted.  The High Court was right in relying upon the
decision of three-Judge Bench of this Court in Modi Rubber
Limited, which has been followed by another three-Judge Bench
of this Court in Rita Textiles Private Limited. [Para 40] [1045-H;
1046-A-E]
2. The Circular of 2004 issued based on the interpretation
of the provisions made by one of the Customs Officers, is of no
avail as such Circular has no force of law and cannot be said to
be binding on the Court.  Similarly, the Circular issued by
Central Board of Excise and Customs in 2011, is of no avail as
it relates to service tax and has no force of law and cannot be
said to be binding concerning the interpretation of the provisions
by the courts.  The reason employed in SRD Nutrients Private
Limited that there was nil excise duty, as such, additional duty
cannot be charged, is also equally unacceptable as additional duty
A
B
C
D
E
F
G
H
1015
can always be determined and merely exemption 

Excerpt shown. Read the full judgment & AI analysis in Lexace.