Customs Act, 1962– s.25(1)– Exercise of power under – Grant/withdrawal/amendment of exemption– Judicial review of – Respondent-assessee imported one set of High Speed Cold-Set Web Offset Rotary Printing Machine with minimum speed of 70,000 copies per hour – Claimed exemption from payment of the duty relying upon the First Notification which provided for levy of custom duty on the said imported machinery at a concessional rate of 5% – However, the said notification was amended through a fresh notification which shifted the benefit of the concessional rate from the aforesaid imported machinery to High Speed Coldset Web Offset Rotary Double Width Four Plate Wide Printing Machine with a minimum speed of 70,000 copies per hour – Writ petition filed by assessee for declaring the amended notification ultra vires s.25(1) – Amended notification set aside by High Court on the ground that withdrawal of the concession could not be said to facilitate indigenous manufacturers – Held: Once it is recognized that it is the executive’s exclusive domain, in fiscal and economic matters to determine the nature of classification, the extent of levy to be imposed, and the factors relevant for either granting, refusing or amending exemptions, the role of the court is confined to decide if its decision is backed by reasons, germane, and not irrelevant to the matter – Judicial scrutiny can also extend to consideration of legality, and bona fides of the decision – The wisdom or unwisdom, and the soundness of reasons, or their sufficiency, cannot be proper subject matters of judicial review – In the present case, the impugned judgment virtually conducted a merits review of the concerned economic measure – Every action of the executive government, including exercise of its power to grant or withdraw tax exemption should be suffused with public interest – The indigenous angle, i.e. availability of equipment, cannot be characterized as an irrelevant factor/consideration, since grant of exemption to a class of goods similar to those manufactured within the country and its likely adverse impact on such manufacturers or producers, is germane and relevant – No mala fides or oblique considerations were pleaded or urged – The exercise of power was in line with the provisions of the Act – Impugned judgment set aside.
Vivek Narayan Sharma (Demonetisation Case-5 J.) v. Union of India [2023] 1 SCR 1 – followed.
Kasinka Trading & Anr. v. Union of India [1994] Supp
4 SCR 448 – relied on.
MRF Ltd. v. Commissioner of Sales Tax [2006] Suppl. 6 SCR 417; Mahabir Vegetable Oils (P) Ltd. v. State of Haryana [2006] 2 SCR 1172 – distinguished.
Dai-ichi Karkaria Limited v. Union of India & Ors. (2000) 4 SCC 57 : [2000] 2 SCR 1254; M.M
Nagalingam Nadar Sons v. State of Kerela (1993) 91 STC 61; Shrijee Sales Corporation v. Union of India (1997) 3 SCC 398 : [1996] 10 Suppl. SCR 888; Bannari Amman Sugars Ltd v. CTO [2004] 6 Suppl. SCR 264; Prashanti Medical Services & Research Foundation v. Union of India [2019] 9 SCR 828; Indian Express Newspapers v. Union of India [1985] 2 SCR 287 – referred to.
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
This page is for informational and research purposes only and does not constitute legal advice. Consult a qualified advocate for advice specific to your situation.