Karnataka High Court
M/S Shyamaraju And Co (India) Pvt Ltd vs Union Of India on 13 July, 2010
Author: Anand Byrareddy
Bench: Anand Byrareddy
DATED THIS THE 13T"DAY OF JULY 2010
BEFORE
THE HON'BLE MR. JUSTICE A.NAAND«BY'RAR'f~3iDD'Y:_'V '
WRIT PETITION NO.~':_1_Q£_%l0 C)t1"~T'3Zt')08 O/III %
WRIT PETITION NO. 10999 OE2_ (IR. .11197'OIF:"20G8,'"1"'l44()
OF 2008, 11441 OF 2008. I 1.442 O_F"2£)U8, .1. I 10?.QF 2008 AND
WRIT PETITION t_$I"O. 1Z'O1_7:@ffi"2"0{)8 ITITAR I
IN WP. NO10810 OF 2008 '
BETWEEN:
1.
V I AND?
Pvt. Ltd' 2. '
Di%Iyz1:;I'ee, P';?:I'i*<- _ 'A ' ., ' '
KundaIaImIII,V _
Bang2i'iO<I*e 9;» 560 0.37
{RvepI*ese'rIted' by P.Shy}Imaraju,
...PETI_T'IONER
' (_'B*§' SiI.Ifi;'"R£1v.ishaII1kaI, Advocate)
AA ' Of India
" -. ..Rep. By the Director
Department Of Commerce
(SEZ Section)
3
l\)
Ministry of Commerce &
Industry
Government of india,
Udyog Bhavan,
New Delhi -- I I0 (ll 1.
The Director STPI
(Development Commissioner)
Special Economic Zones,
Ministry of Co1nrnunication:&__
Information Technology,
Govt. ofindia) No.76 & 77,
6"' Floor Cyber Parlg Q_
Electronics City, *
Hosur Road, V H
Bangalore _--. IOCL V
The Aséiietcttit:De\geilot)jinent_ '
Commis*a;i(ine1?'§h V j ,,
C{3cliin_"S;:i::cial"fEIcc>n-timic
Zone ' ~ .
No.365=, 8* -MaintV%l'vh..CfQS.S,
ViVe1i{°NagVa1',x'_ 4' -- D
:E9vn_g3.lDl'C.,f** scat) one
_ Tlie:'Se"cretary iiiii N
~ " = 55 Finance
Depai:t:*i1e'nt--~'()f Revenue
V 'iGove'1:i;ij_ment of India
No.14' Hudcti Vishala Building
B Wling, 6"' Floor,
D ' 'Bb'ikajiCa1nz1 Place,
_if;New Delhi. -~ l 10 066.
The Member (Customs)
@
..- Sea/pedj' V " .
Ls.)
Central Board of Excise & Customs
Ministry of Finaiice
Department of Revenue
Government of India,
North Block,
New Delhi.
6. The Commissioner ofCustoms
CR Buildings, Queens "Road, 0
Bangalore ---- 560 001.
7. The Stiperintendent of Custorus'V_
Authorised Officer, "
D-ivyasree Park SEZ, .
Kundalihalli Village;
KR. Puram, Hobli, 0 V
Whitefield,
Bangalore RESPONDENTS
(By Shri. Hai~ipi~:tssai1%,'Advgeaie for 11.1 & 2
Shri. N. R. iBhz1ska1", Vi'°.\'¢i$:/'()_CElE¢ii'f()17~"SEiI1i0r Standing
Counsel for toe and'; =
Shri. K.,l\l.. Mohzi;2,VAd.v'<)c2}ite for R.6,
VT.Wriifl§etii'ion'_:N<). 10810 of 2008 is filed under Attic.1es 226
and-2127 of 'ft-he'T;; Constitution of India praying to quash the
impugned _ instructions/directions/communications in
' 'l?.N0.6/2[2'008¥SEZ dated 23.5.2008 at Annexure--'E' and in
J".f-..l?';'No,6/2/2{308~SEZ (pt) dated 30.6.2008 at Anuexure~'G' issued
_ by the"Respondent No.1 and the impugned direction issued by the
0 i.Resf3'ondent No. 1 and etc-.,
3'
IN WP. NO. E0999 OF 2008
BETWEEN:
l. M/s Vikas Teleeom Limited
Vrindavan Tech Village SEZ
Devarabeesanahalli and Kariyammér' A
Agrahara Villages, Varthur Hoblii
Bangalore East Taluk, ii
(Represented by Mr. Yagyesi_h'_V
Sharma, Manager)
F»)
M/S Adarsh Prime Proj'e_cts 1.
Private Limited, ' - * 1 V'
Vittal Mallya Road,
Bangalore 7 5:60» 00 1;}
(Rep1'esenfed l§1y'l'iVi1f¢4Shel<':ir, *
General?Mari--age:c;"--._Finaece) _ _ l
3. M! M :1'riyal:;_i Pf?if)ii:<)ie.r$" Pri\/Hate"
Lii~n_ite--;j' " * _ ~ ?
Manyata E1T1b2iS$iy._B'U.$'lifif:S3
Park S122; R21chenha'lli}=.nd
Nagnvaréi Villages Holjli,
Quiei' Ring R'oad_,___y .
_
"(Represented by
._ (icpinaiii A.T
' Vice P1*esiile.nt M Finance and
""LegV4l)"
A Bagmane Constructions
" -_ _.Private Limited
World Technology Centre SEZ
Mahadevapura, KR. Puram,
Z
Bangalore North,
(Represented by Raja Baigmaiie
Managing Diiectorl
3. Tangliii Developments Limited
Global Village SEZ,
l\/lylasandra, ,
Pattangere Villages,
RVCE Post, Bangalore V «
(Represented by Mr. Shank2i.i*,'«--.._V
Director)
6. Cessna Garden Developers
Private Limited, it
Cessna Business Park SEZ,
Kadubeesa11aliéill_i V ' ftige',
Varthur HG_i)li.i}}.i'i =i * A
l\/12iI'E1tllEl,l'l3lli...f~;S.&lj3§}llE_"CFEl'[€I7." v
Ring__l?,0ad, '.:,;., _, * *
Ba:.ti,galio'r'e.. ,'_§0utlii:fTa1lt:'l< ,
(Reipresieiiteti €33-' , l\"i1'_. __Rae,
Presi'de1ir--Erl--g.)'w _
7. RGA S()fitw_2ire..S--yste 1niS:P1-ivate
viiimited " _
' . V '"il3}7ill"1:i'£1l Projects Prii/ate Limited
SEZ_,lBe'l.la"n(_1'ur Village,
VEllv"lllt1l'iVlilOl)Vl,l,3
. "'Bian.g3.lt"ire,'Ez1stTzrluk,
"'~Ban_gali)1'e Urbz-in District
(Rep'1§esei1t.ed by
* it Ramakrishnan
H Chiel'Fi1ianciai Officer) ..PET}T'I'ONERS
H Shri. .K..S. Ravi Shankar, Advocate)
Z
Hobli, Outer Ring Road.
Bangalore.
The Secretary, Ministry of Finance
Depaiftment. of Revenue,
Government of India,
No.1, Hudco Vishala. Building
8 Wing, 66' Floor, Bhikaji Caina i"?_1ace,. f;
New Delhi ~ 110 066. A
The Member (Custoins), .
Central Board of Excise & CL_i_s_tuonfis--,.._»
Ministry of Finance, " i
Department of Revenue _ _
Government offndia, A
North B1()c}_<,..-ipi 'A i' V
New Delhi,
The C()1n'mi's--s ionei" m»*a.Cu's to
CR.' Buil'di..niS, Qu'e'ens"Road, '
Baf1g&1]_0}.'e:?4"5.5fQ:Ci0_1i'."~._n*~._ ~ ~ ..RESPONDENTS
(By Shri. for Respondents,
Shri. Haripifasad, Advocate for R.i & 2 and
' Shri. '-iKfN;_'---M()th£1n, Advo-cate for R."/)
ixnptigned .~ ~ _ L'
p ':F.No.6i'2/2Q08--sEz dated
vF.No.6/2./2('}08--SEZ (pt) dated 30.6.
'~.byVthe..'Respondent No.1 for which the justice the Petitione.r(s)
'VV7/*s'tif:i:'tPetiition.No.10999 of 2008 is filed under Articles 226
and "227 Voffj-the,"Constitution of India ra in to uash the
. _ P Y E Q
inst.1_'uctions/directions/cornmunications '
wotii'd-pas in would be beholden and pray for.
Z»
23.5.2008 at Annexure--'L" and in
2008 at Annexure--'N' issued
IN W.P. NO. 1.1.197 OF 2008
B BTW BEN:
1.
'Viee 'Presidera--t) V %%%%% H ,
M"/s Biocon Limited
Biocon SEZ
Plot Nos. 2, 3, 4 and 5 of
Bommasandra «M» Jigani Link V
Road Indust1'ia'l Area,
Bommasandra Post.
Anekal Taiuk,
Bangalore ~« 560 099 __
(Rep. By MB. Chinztpp.-4,
Vice President) " *
M/s Syngene.1Vnte1fnaf;ioiiai'.L,i ;f1i«ted I .. 2 " B
Biocon '
Plot No$.'"2i;i «3_,14~v-&i*nd 5:_Q_i_'"
Bo minasandrafg J i'g,ani"L.'i'nk"
Roadiiihtieuétrial . 9 " V
Bo'ni1n-ztsandfa"Post, ' " - __ - '
Anekal Taluk,
Bangziiere -_ 560 C99"
(Rep. B y" M . B . .Chir;apba,
...PETITIONERS
V'-{B y 1131." R5'v.ishanka.r, Advocate)
__eAND;ii'
Umda of India
it By the 'Director
* . _ _Department of Commerce
(SEZ Section)
Ministry of Commerce &
8
Industry
Government of India.
Udyog Bhavan.
New Deihim 110011.
The Development Commissioner
Cochin Speciai Economic Zone (CSESEDA C
Kakkanad,
Cochin -« 682 030,
Kerala.
The Specified OffiC€1"__()f
Biocon SEZ, A
Piot Nos. 2-5 of
Bommasandrasjigani C V'
industrial Are-alt',
The Secre~tgir;=1'i.;_:,. _. V
Mijgfistriy' (>.€fiv5Finzi%gé'c
Departzne nt €if7'i?,eV'eiiue.' ' ., ' C
Govermnenlof
N0.i4;"Hude0V'Ji$ha13éBuiEding
Ewing, Giiziocr,
_ _f i:3i1hi:1<__f2i_§i VvC21111éI'*P1f«_,1gf
C' « _ _ Nexiv :'De'1_hi»-- 1. 1-0 066.
_ "'i'._ThevMen15es*"(Cust0ms)
' Central e~B0a1"d of Excise & Customs
"Ministr'y"0f Finance
D"epa7i'tn1ent of Revenue
" * 4_G0V'emm.ent of India,
ii * _N0rth Block,
New Delhi.
*' '~Udup_i 'Dis;:tiict:
6. The Commissioner of Customs
CR Buildings. Queens Road,
Bangalore - 560 001. RESPON_DEiN_"FS
(By Shri. Y. Hariprasad, ssc for R.1, R2,, 11.4 & R.6__--':.:i..ii
Shri. N. R. Bhaskar, Advocate for Respondents and__ ' R. R
Shri. KN. Mohan, Standing Counsei 1"()1'.R;{7»)_A
Wm Petition No.1 1197 of 2008 i§'.fi]ie_d'i1nder_Z\rt.Vic.1e's:i_i:"2.2;6.i.
and 227 of the Constitution of' -indie "paying ;iC)"VVqV1J'.1Si]i; the
impugned instructions/di1'ection's!e()mrnun'ie.ati~o-nisi in '
F.N().6/2-/2008-8332 dated 23.5.2008"-eat,VAnn€'::.uf€--'F'ij and in
F.No.6/2/2008--SEZ (pt) d2;t"'e(1_« 30.-f3.i'200.8' at'eAnnexi3re--*'H' issued
by the RespondentNo.1and"ete.{,i
IN WP. NO. 1 1440' oeezoostt' Z;
BETWEEN: R R
M/3 Suzlon Inf;'asti'it1c't-are S-EZ
Vi1!ages.N'-asaiu, ' R' " -~
Nandikuru, PM;n1:1rni'&iiHie_}'a.iii.adi,
Udupi ».g574 111., LA
in Riepreéented 'r>y*its Director
Mr: lite ncizra "Tami
Si/do Late MtZ"_~R_21nehodbhai_ Tanti
Aged__about 45' it-'::tii,irs. ..PETITiONER
i;j'~.__i(By Shri. V.S,
" Hagish & Co., Advocate
3
AND:
C(':ChiI1-~.682U357. N D D
The Union of India
Represented by its Secretary
Ministry of Commerce & I.ndustry_.
Department of Commerce,
New Delhi.
The Union of India,
Represented by its Secretary,
Ministry of Finance,
Department of Revenue,
New Delhi.
The Director, _ -_
SEZ Section, V V' ~ . .
Ministry of C_o'inmei*oe"& --I.ndu'str'y_, V
Departmen';oi'£fom_rn.e1'ce,--~7 "
New Dej.I1<'1'i."'v TV ' '
The,De:ve1op'ir.aent4 'Cy(>'1'n_rniss'ione1',
Cochin Specie} E.eo_nC;--mie«.Z()ne,
Kakkanad; _ D " D'
. _ ."The"'uCe-nitiigii B()'¢1iidm()f Excise & Customs,
" North'
"-[New :D.e_iiiij; ~ . .
DD"'Fhev-..'Auti:io1'ized Officer,
Suzgiotn Infrasti-ucture.
" +.;SpeVC'iai EC()n()I'fiiC Zone,
y.o Udupi -- 57411.1.
ii Karnatzlka.
..R.ESPONDENTS
3
E2
(By Shri. l.\l.R. Bhaskar, Senior Standing Counsel
for R1 to 5,
Shri. B. Pramod, CGSC for Respondents and
R.6 Served)
Writ Petition No.1 1440/2008 filed under Articles 226 and
227 of the Constitution of lndia praying to quash the deinand
notice issued by the 6"' Respondent .J'bear_i'ng
F.No.SILSEZ/MISC/2. dated 06.08.2008 demanding payifne_nt'.j'r)_f
duty of export of steel products with effect from : '
Annexure--G and etc., ,_ .
INW.P. NO.l144l OF 2008
BETWEEN:
M/s Suzlon Wind International V
(SEZ Unit in Suzlon lrit'i'ast1j1it;turt'; ,SEZ)
Udupi -»~ 574 lll. 0 ii 2
Udupi o1s:ri¢t;' -- it 5: 0
Represented by itsi'iDl'i7eietr)i"'J'-----._ ' 0
Mr. VinodTarsti _ ii . =
S/0 Late Mr."R.aneyhodbh';i.i Tana
Aged abe-11t45 R r ..PETITIONER
R iiiii H
"'fo1*"H_a1°issh..y&i ¢:"o._,' Advocate
AND
_...._....,,...._.._
'ls T'ne__iUnion of India
V. A Represented by its Secretary
" .Ministi'y of Commerce & Industry,
Department of Commerce,
New Delhi.
5
N
The Union of India,
Represented by its Secretary,
Ministry of Finance,
Department of Revenue,
New Deihi.
3. The Directoi',
SEZ Section, V
Ministry of Commerce & i1=;dus:t1'y, ii
Demrtmeiit of Cornmerce, °*
New Delhi.
4. The Development Cornmissi--o_ner; _ 9
Cochin Specia1Ec(>no1fn_ie Z',on_e_, ii
Kakkanad, C _
cochin--_6?32 .
5. The C¢nt'1>gi1ii:'E (nerd ii of
North
New Deihi. _
6. The Ain:_h(3rized_Officer;
Suzloii i1ifr_21st;r1,1etui'e,
~ 'S?;pecii:a.l Econonfiic Zone.
- _ i''"Udi;i'ipi 44 574 11
' -.Kaiina~ta1-:ai§'v ..RESPONDENTS
(Bysin¥;. Senior Standing Counsel
C Si _ for RC1 to.--._5, 2
-4 'Shri. B. 'Pratmod, CGSC for Respondents and
" .S_e1-ved)
'Writ Petition No.1 1441/2008 is filed under Articles 226 and
of the Constitution of India praying to quash the demand
5
W
i_'.J'i «
notice issued by the 6"' Respondent bearing
F.No.SI.L,-SE2/MISC/.'2, dated 06.()8.?.O()8 demanding payment of
duty of export of steel products with effect from 1.0.05.2f)Vf)_8..s_ige,,
An11exure~G and etc..
IN WP. N01 1442. OF 2008
BETWEEN:
M/s SE Composites Limited _
(formerly known as Suzlon T()wersi"'~._i'
Internation Ltd.)
(SEZ Unit in Suzion Int'rz1stijtieture'i is
Limited SEZ) it "
Udupi -- 574 111. "'
Udupi District. A . V . .4 _ V_ I
Represented
Mr. VinodTa1iiti p _ »
Sfo Late Mrs,Ran¢i:ei3*iahai_piiaii;i «. i '
Aged abt?»'iit45"yeifé\.rs. "7: "
..PETITIONER
(By Shfi.
for Hari sh & V', .Adv.o(:zi_te ,
] "T_hev.Uin:i.on'o:t' India
~_ V"H,Reip£e's.en_te'd"by its Secretary
' vi\/1iI1_iS'ti'3i*v'f)'i: Commerce. & industry,
i"DepAa1ti'nent. of Commerce,
N'ewi3~De1hi.
.V' a The Union of India,
Represented by its Secretary,
Ministry of Finance.
is'
Depamnentt of Revenue.
New Delhi.
3. The Director.
SEZ Section,
Ministry of Commerce & Industry,
Department of Commerce,
New Delhi. 1
4. The Development Commissioner',
Cochin Special Economic Zon_e;~~._p
Kakkanad, 0' C
Cochin -- 682 037.
5. The Central Board of léiteiiisei
North Block," _ - V
New Delhi." 0
6. The
Suzloits7I.nf1*;1str't:s:;1;ure,_C '
Special Er;ori:.:rn.i'cw.Zor1e'?-__ -- 0
Uduipi ---«574-- l. _
Karnatitlga. _ _ = ..RESPONDENTS
" V. (By Bhias-ka1f'.__Se11ior Standing Counsel
'--Shri. 1Pran1(_)ti..p"C.GSC for Respondents and
R16 'S-'erVed)"~«..,p_
il"W1'i't. F'etlitioi1 No.1 144?./2008 is filed under Articles 226 and
"227 of 'thel Constitution of India praying to quash the demand
0' l_'n,()tice'_ "issued by the 6"' Respondent bearing
* T lF.,ANo_.Sl.I'LSBZ/MISC/2, dated 06.08.2008 demanding payment of
._ '««.-'duty of export of steel products with effect from 10.05.2008 i.e.,
Annex.ure--G and etc., -
S
IN WP. NO.1 1107 OF "2008
M/S Himatsingka Seide Limited
Division: Himatsinka Linens
Plot No.1, Textile Specific
KIADB Industrial Area,
Gorur Road,
Hanumanthapum 13.0. I
SEZ--HaSsan, Karnataka.
(Represented by its
Chief Financial Officer " _ V _
Mr. KP. Pradeep) C ..PE'fIT'i0N:ER
(By Shri. KS. Ravi Shanléaizz::"'+d\z'ir§Cflie.i ".
1. Union o£ein.d1aiii.ie _ .i .
Rep. By'Vthe"[:iii~reCii.iI"~. 'A C
D§3j:iiaift1'i1eif£1 ofifiomiinel'-::e ii"
(SVEZ Se<tti<f>":0,~.._» '
Miriistry of --C(mi'm_.e
Indusfiy" _ V' V "
.C'0y'e1'niiie_m '0.fFInd'ia,i ii
" '~i'Udy'eg Bhai/'2::}_,v_ _
Ne"-€52 i§'e1in-- 110 01 1.
De*»ie«1.g)prii'e;*it Commissioner
_ i'iK[ADB_Sfpeei2a1 Economic Zones
(Hassan')
Defiiartment of Commerce
.r~>"
'' ' ._ Gdve1'nment of India
" -- _i.--'i\/{inistry of Commerce and
Industry
K_z1k}<21nad,
5
Cochin -« 682 037.
The Secretary
Ministry of Finance
Department of Revenue
Governntent of India
No.14, Hudco Vishala Building
8. Wing, 6"" Floor,
Bhikaji Cama Place,
New Delhi -»-- 1 l0 066.
The Member (Customs)
Central Board of ExclSe._& 'ii. -
Customs
Ministry of Finance,
Department ()liiR.€V'€1:li.16 C i "
Government 3:
North Blticktw b
New_jl)e1'ni N
The Deputy"Co-rni'ni$'stio_oner* 3
Of Customs' _
KlADiB._<Speciia1_. Ect)11oi_;ii.c
Zovne (H2iss,an')V '
Otffice of the "Dey_elopme nt
_ iiCoi'ninies.i_onet',
Ti "Co'e.hiin,v'Spec.ial Economic Zone,
_
X Coc_l1.in5T~_ 682 037.
Agutléorised Officer
C ' KIADB Special Economic Zone
" -.
Office of the Development. '
Cornmissioner,
3
Cochin Special Economic Zone,
Kakkanad,
Cochin ---- 682 037.
(By Shri. NR. Bhaskar, CGC for Respondents and
Shri. Y. Ha1'ip1fasad, Advocate for R1 to 6)
Wm Petfiion No.11107 of 2008 filied j11fic1¢t'.A.r:ic1e1sy225T
and 227 of the Constitution of Ind1a«V__p1%;1ying't()*~quas11_;"«1.h'e*..
impugned instructitms/directions/Com_munica.t'i'C1ns__ 1 in _
F.No.6/2/2008~SEZ dated 23.5.20'G.8""~at Ar1nexure_.--'Gf em: in A d
F.No.6/2/2008-SEZ (pt) da__ted An'n-e>_g1,1re-'EJ' issued
by the Respondent No.1 do
IN w.1>. NO.12017 QF 20081
BETWEEN:
M/S Infosys__TeChnoié}gies, L~i1n;i$ed
Regd.
Hosur Ro'ad,: ' . _ ' -
Bangalore '-5560 100." if V.
SEZ Unit/'Dev.e1og3erV'at " .
Hebba} 'Indust1'iVa!.,A1'e2i, ''
" '~ M_ysn1'e in Z K.a.r._f..1.'c1t:1ka
and,_SEZ Un1t_/fleveioper at
Ka'mb'13.n'a»dé1z.{;"1» AV ' ~
K111*nad PO'); __ » v »
Paji1<__Vi11age{
; Bantxéi/:11"l"Aalui{,
'DakshifiaV__Kannada (D.1<)
'A ..je'MAandg.a1ore in Karnataka
" _ '('Re--pr.e5sented by its Chief
Finaneia1Offiee1*
T ~1v1r. V. Balakrishnan)
...PETITIONER
..RESPON'DEN%f.:S_:'~.o_
(By Shri. K.S. Ravishankar, Advocate)
AND:
1.
ix}
Union of India
Rep. By the Director
Department of Commerce
(SEZ Section)
Ministry of Commerce &
Industry
Government of India.
Udyog Bhavan,
New Delhi ---- l 10 0
Develtipmem iComm;issioiier
Infosys Tei::_hng§l'o_gieS"
M.ySore=i' ' , _
Dep;;1_ftment"'oii.:_CLuiiujriefee ~ :
Geye1'n1'ne1it of
Ministry of C0'm1'ris§fi'Ceya~r1_d' 3
Industry N0;76"&f77';--~._
66' Fidmay Cyber _Pti'1'l(;
ElCC_tIOI1liC££,Clfy; '
ynnifiostiifit Road,
A iBangialor$_._~ 560 100.
"'i'.__yThe' l3i.reet_o2"'
i ' Soft_\yare_ Technology Parks
"Of "lnditi.
l\/li.ni}»t1'y of Communication and
ii ' lnformation Technology,
V " -. No.76) & 77,
6"' Floor Keonics Electronics City,
Bangalore -- 560 I00.
4. The Secretary
Ministry of Finance
Department of Revenue
Government of India
No.14, Hudco Vishala Building
B Wing, 6"' Floor,
Bhikaji Cama Place,
New Delhi -- 1 10 066.
5. The Member (Customs) _' .
Central Board of Excise & Ci_1_stVorns'V._»
Ministry of Finance' " i
Department of Revenltie" *
GovernmentofIndia,___' 'N
North B}ocl<.,-_ N" _ -
New Delhi._._ _ _
6. The Comirniissiignei'
CE l3iiii'dir£gs, Ci.ieens.'VRr)ad.'""""'
Banga~1oiie.c --" 550 't')f.)_1';-._[ __ --
7. The Clorni'n.issio_ner. of
l'anatnbiir,._ '
tln,tW:i:aa1o<>re. RESPONDENTS
iB=ylS'nri." Advocate. for Respondents and
S'ori';'fB, Pra1_nod,"_'C'GC for Respondents")
V i""W1;'-it'Petition No.l20l7 of '2,0()8 is filed under Articles 226
and 2-2z7. "3f the Constitution of India praying to quash the
ll..js'inipitt-g«ned' instructions/directions/cotnmunications in
'F..l\Eo._6/2/2008--SEZ dated 23.5.2008 at Annexure--'K' and in
F§N<).6/2/2008«SEZ (pt.) dated 30.6.2008 at Annexure--'l\/I' issued
..l3yV the Respondent No.1 and etc.,
T9'
21
These Writ Petitions hm-'i.ng been heard, reserved for Orders
on 23.6.2010 and coming on for Pronouncement of Order.:';--..this
day, Anand Byrareddyj delivered the following: -- i "
ORDER
These. petitions are heard and disgposedlof"to--'gethe.rxh,;1iVingv7 regard to the common issues that :1rise for con"siderati'C~rfl. Vi '
2. Heard the leztrnedéctiuitiseie if'orit'l3.e pet.iti't>ners and the learned counsel for the i-espond~ents'," 'V
3. The ;fétct'i.«i.ai is*..'as~fr'follt)ws:
he 1:5etiet.itV§nersl'§;iife_ei.th'e.r 2. i"Be'\}eloper', a 'Co--Developer', an 'Entrepreiieur',' Unit', as defined under the Sub- c1ausefs'of Sect1on'zwhvtifitheliispecial Economic Zones Act, 2005, refieifred the "SEZ Act', for brevity). The SEZ Act;".ig;réf- .}Ti'_~.!.i_c.i,~.i'pr'ovides for the establishrnent, development and 'V n1anzigen1ent"of Special Economic Zones for the promotion of i..f_'eitpio:ts. While notifying an area as a SEZ, the Central i Government is guided by the objects enumerated under Section 5 E TO
ix) of the SEZ Act, vi2.., generation of additional economic activity, promotion of exports of goods and services, pi'omotio«n_i'~x.of investment from domestic and foreign sot11'ces,j':--cre_atio:n- * empioyment opportunities, deve.1opment "ofi.-nfrasittructtrreé f2icvi.Ei'tie's..
and maintenance of the sovereigntyVflarid_ iinteg:.ity*.,of"WIndia'._ including its security and friendiy revitititrgns with fore'i_g1i"<j:oh'ntries. Section 26 of the Act exemptions, drawbacks and ct)1'ic'essi.t)nsV"to' entrepreneur', 'co-deveE_oper'; the SEZ Act. There is exemption" goods imported into or services }3vvrmr'i_ded on the authorised operations and exemetions' fromf'cus'torns duty on goods exported from or servic'es provided iirotirimit-ifSEZ. Exemption from duty of central ex<;ise_ uincier-«.the.iCe'nti'al Excise. Act, 1944 (hereinafter referred to as the"~--'E9.44 for brevity) or the Central Excise Tariff Act, . f4"'v.§c,.i:)8Ssc()_here"inafter referred to ' the CET Act' for brevity), on Nihrought from the Domestic Tariff Area' (hereinafter Z referred to as ' the DTA' for brevity), defined under the Act, to an SE2. These exemptions are claimed as per Rule 22"~.,o't7_tt1e Special Economic. Zones Rules, 2006 (hereinafter ifeiiervred 0' 'SEZ Rules' for brevity) .
B virtue of the Finance Act, 2008,"i--v211'ioit_1v:%-0.items were included in the Second Schedule Taiiii'fyl&_llt()l'lthe't§Customs Tariff Act, 3975, inc1udin':%..._.j§*igfi;ton;5_0: iron and steel products of vafious typ-eel. tariff rates of duty at and steel items.
Simultaneouély,:..on._v Government issued an the effective rates of duty on sixteen .,itemsll" added the Export Tariff Schedule. Cc:nseC§t1en~.t§y, all Development Commissioners were made aware that ""e_:;pi()"rt been levied on export of steel products and 0 0 _tlie1'efo:'e t!:_iey-vwei'e to allow supply of steel products to SEZS on "si,1»bmissit)n"'of a bond and a bank guarantee in case the duty would ..jbelii'--:t'iinally payable. The notification dated 10-5-2008 was 5 24 amended by another notification dated i3.6.2008, reducing the rates of exemption and thereby increasing, the effective rate of duty.
The effect of the customs notifications issued'u.nder'~Sectionf 25 of the Customs Act. 3962 has been'~con_strued'ssas=eriab'iing_'thc* levy of customs duty on transz1ctions..treate'd as .e_xpi-orts_;'«-vln other a L' words, a domestic manufact.ure1' oi'Ays--up:p1i.ei'-..of'theisubjeef items. is treated as an "exporter" andthe'ps1:<;E»aser:v¢jithin the SEZ, such as petitionei'sv-_,c'ontenyd*----Ehat-f the impugned action has the unnatural effeetiosf ievying' duty of customs on goods which are "2neithe1'5'«;3hyisi<:a1Iy rnt)vi.Ugv0L1t of the territory of india by treating of goods outside India nor physically moving into'I_.ndia frtinfi outside lndia as "iir1port."' of goods. It is also ~'a___fc~ontendedVV__ith.21t yet another effect of the action of the respondents t'na_.t_Ai.-g()ods manufaettued in India, which are subject to ievy 'asunder the Central Excise Tariff Act, are being treated as goods 5 25 exported outside India and imported into India for Eevy of customs duty.
It is in this baci<.g:'ound that the petitioners are i3et'()re'»this COUIT.
4. The iearned counse}. for the petitioner..w_ottEd*con_tend" A that instructions issued by the Despart-ment7.of._i 'Com'1nerc_ef construing t.he notifications datedV'iG«.-32008-._2indVi3;§f2.(}{}8, under Section 25 of the enviéfibiing its officers to exact or levy custcans.duty§.iact.i'ngi authority under the srsz Act;iiisstWith*oVu't jurisdicition and iliegal. The said action defeats' the p:19oii}'Vis.ior1s"o.f:i'Seicti()n 26 of the SEZ Act and the SEZ Rules the:reunde::,ii~EVnpiirticuiar Rule 22 thereof. It is
---.contend'edv that the ir';s.triieti<)ns issued are contrary to the meaning 'g?1i.:'ii'II1;1")(il"._t of the definition of expressions used and [jostu.iatedv.in...V itlie Customs Act, i962, which are to be reconciied and appiied: totiaie provisions of the SEZ Act in terms of Section 2{,zd) of the'1~Eatter Act. As for instance "'Endia" wouid have to be 5 understood according to the provisions of the Customs Act read with Article 1 of the Constitution of India and it leads. incongruity to equate the SE2 units, entrepreneurs r.:g'i":=deye'1o'pers--*1 * as being situate in a foreign territory so ;a's"to--tax items ii*er';eiye.d,.byv., them from indigenous manufacturers in India i:rip0rt.o«f and conversely tax supply of goodis"t<,r;iaiie by 'local, itraritfiacturers or suppliers in India as exp'o'rt of'good'si,_I.tiis_contendeVd that the petitioners are neither importe1s_no_riexportersunder either the SEZ Act or r_esxpec--t*:of the notified items and hencevcannotyybc'éa11Ved_y to export duty thereof. It is'-stated thatthe"ivnconigruity which is created is evident from the, circii'mstanc.e ii'i2i't""ih€ Ministry of Finance itself had s'ou.gh't toir"*elarificatioiniiiitrom the Ministry of Legal Affairs as repoitedi 'viii-,the.i'.i'-newspapers and published in the Incom.e--tax _Repoii'ts d._ated:"i,'§.8.7.2()()8. It is therefore prayed that by the i.n1pugnedV"directions to exact purported export duty on materials
--.i.'.-rrarnedi in the said communication from the petitioners, which if prevented by this court, would be violative of the § Constitutional mandate under Article 265 and 300A of the Constitution of India.
it is emphasized by the learned Counsel for : ' that by virtue of the impugned directions"; 'éi'n"a«rtit'i*§-.ial theory is sought to be created in i'elatioin__tio__the expressions "India", "import" and 'i'ei<:pt>rt", it levies sought to be e.x21cied,_ of 13w_ Attention is drawn to Clauses Act, 1897 (hereinafter;-C;iieitetrred.vto for brevity) t to contend territory of India and cannot byiaiiyf inferegnce-'cienote a foreign territory so as to levy expoi't..._4du.tyiii'o_ni to 21 S132 unit by a ciomestic " vr.nanufai:tu:riiigV unit i'n .l.n_d_ia or to levy import duty on bringing into 5 an the :SE2S rifoodsfroni indigenous rnanufacturing units in India. Thussitihe girnpugned directions therefore are contrary to the established firinciples of taxing statutes. The same is also contrary :t(:,t'i*.e_ decisicin of the Apex Court in Abcm Loyd Cliiles Offs'h(,)re
-.It.zT_n.ti're¢2' vs'. Union of Inclici, 227 BLT 24, wherein the Supreme 5 Court has held that the territorial jurisdiction of India under the Customs Law would extend to the continental shelf and e:<clu.siive economic zones and that the principles of intei{i'iation'alf"
including United Nation Conventions on' the L7_aw_, it would be applicable while inte1preting".fise_al lavvs..sti<:li Customs Act, E962. Similarly, tt1er"impugri'ed 'in_is.tru'ctiions run V contrary to the decision -{j()11eic§;;;y Customs vs. Sun [ndusrri'es, ELT' in order to constitute an to a place outside India. the first respondent are the re fore 'contraryi to 'the '3ettleid----pr'ineip1es. It yconten.dedwt'hat'- terms of Section 26 of the SEZ Act, tlie«pe'titio'nei"s ate carrying on activities as duly approved under the virtue of the impugned instrttctions, if
--Vimpleirnented;'vi/ould have the effect of depriving the petitioners of ltliei be.._nefiits of duty exemption guaranteed to them by law and *'wog.1ld result in converting a privilege into a disadvantage. The *5 29 petitioners would therefore contend that the Doctrine of Promissory Estoppel. would be applicable in the circumstances. I_t is pointed out that in respect of several cornpliances under various laws, the SE2 is considered being an integral part for instance, there is no exemption from stamp duty'7or iIe'laXiation_f V' under any Labour Laws. There is also noiiezteinptionjifro.rn"any':
provisions of the Factories Act, 19-48, th'e_l5'ublic Frtwrideint lE'u"ritii'= Act, l968 and so on. That being s(),iith_e' SE2 un-i--t'_bei'ing treated as being outside India for lev__\iIi:i"of'i.ex;gort"--»tiu,tjf~ialone by the first respondent is wholly'-withoufiuriispdiction anti Thelearned .co'ti'r':1t;seil' petitioner would submit that the Gttja1"at High .,ltas"vi1ii'Lhe case of Essar Steel Limited vs. .U??i()i1I"ilflt(1iEI...'249 ii3(GH_j)t addressed the very same issues and 'hasiieil'd_tlia.t~the action of the respondents in levying export V _ duty gt'-i_:'o'ti:«: suppl_ied from the domestic tariff area to the SEZ is not justifiied and would place strong reliance on the said judgment would submit that the princigs laid down therein would U.) ...._ and all procurement of goods imported as well as indigenous were exempted from customs and central excise duti_ea._i"b_y'~..a Notification issued under the Customs Act and the ~ these EPZ Schemes, units were set up Vv'ifl1'CX.D0if{ o_biiga;no'r.. ._a.nC'a, they were subjected to conditions in the sclieme and.nt::ti1Ticatio.ns'i. issued to clear goods to the domestic ma1'ket"won.: payment of V appropriate duty. With as SBZ in the year 200}, the the SEZS as areas where apply' Th61_6fOI.e in May wiasiiamended to incorporate Chapter 1iDA:a'nd.Vaiiiiowedsypia'i1.:gti_ods imported into SEZ to be zero rated for cust'o..nis and _fo1<.a"iIys_.upp1ies from domestic tariff area to "be co1is.id:e_i'e:iVvy at p2'1r«.w__i_tl'i fiscal imports out of the country and idtlius ieiternptifroiii---_1evy of centrai excise duty as well as being eligibie f<)i'.tii'é1w:;back and other export benefits. All documents proCedu1'es under the Customs Act and the CE Act were it :biei'n.g ii>i1t)we--d for bringing the goods into the 8.92 well as for renitival, whether for export or for sate in the domestic tariff area. $ 32 With the passing of the Special Economic Zones Act, 2005, which has come into force on 10.2.2006 along with Special Economic 'Zones Rules, 2006, Chapter 7 of the FTP and Chapter l()A;of--.the Customs Act were rendered redundant. It is stated Act prescribes exemptions from customst centr-al.,:fexci.s:'eand"
certain other duties under Section 26 'of t:_l'i'e..:SE3Z.iAct. i"lt-.._also.l created a category of persons ca'l1ed-~..f'developcr" whoj 'tool; over the responsibility for investing in and p1<:)viding 'i'acili_ties7in a SEZ that were used by the eXpo1"ting'un'its.iito' be the SEZ, both the developer anc':'a._t'ne .£¥.l:'('): eiigible for the exeinptions. 2 'The'i'S*EZ:;~i_'are"=.notified by the department of Commerce andyptlterei is cornplound wall to enclose the processing " * area Tuli'e« are under the administrative control of 'Dev'elo'p_nie'nit._Commissioner, who is an officer of the Central Gitvernrnepntiiiilii-'V. f)evelt)pments are approved by the Board of Approvaivsy, it as are cowdevelopers. They are authorised certain _ope1'at.ions within the SEZ. The goods required for carrying out the authorised operations are eligible for exemptions under '5 33 Section 26 of the SEZ Act. Section 2 of the SEZ Act defines "imports" and 'exports' for the purpose. of goods moving _.i.nto«._aiid out of the SEZ. Likewise. an exp()1'ting unit is t1ppif('S'tIed:iyi'tsviy" ~ Approval Committee and is eligible. foif'e"xempti-on _un'der sec_tji.on, A 26 of the SE2 Act for goods brought oit1t..'yio'f.tlte Procedures are prescribed under Rules:
into and out of the SEZ 2t:s;i:,..'_&}3.ll "tiny as laid down under the SEZ__Rules._.T. the SEZ are considered as under the Central VAT the SEZ Act. However, under documents -- shipping bills are required to be*-filed and p1'ocessed only when goods are consigned 'V'outsi=:ie3.I.r}di2t or tvihemthe goods are brought from the domestic "'tari'ff_area'-»into*an<SEZ under drawback or for availing benefits under; the In order to give effect to this system without recourse' vto' amendments in the Customs Act or Central Excise . Acit,*--th'e SEZ Act by Section 53 deems zones to be territories outside. the customs territory of India for undertaking authorised é 34 operations. Section 52 also specifically rescinds the erstwhile provisions of the Customs Act that referred to SEZS. Thef:SEZs the1_'et'ore._ operate under the SEZ Act, for the i~7o__f exemptions from the tariffs imposed byuthe Union w.ell.Atori' clearance into the dornestic tariff area on p-}1y'nient._of' dutiy.::"tt..fFitc~ procedures are independent of thic._:C»-.istotris Act_":i1'e--..w1iolly --. ' governed by the SEZ Act -avndz the Rt':iteist-he're()f. S S Twenty six items have 'export duty under the Customs Act3tili'«.3p:p1';3.'2if)08.i.iWi't.hi"effectfrorn 10"' May 2008, the Finance to the Second Schedule of the Custorais .,;:\ct,iiVv_f1'i'e..h'included items of iron and steel rendering thenriliabi'te' to "e2t:_port duty under the Customs Act. 'i'*Eft'ec.tiv.eErnteVs of "duty__..on these items were prescribed by a issued under Section 25 of the Custolns A.ct':;;nd new effective rates of duty were further prescribetitlnder a Notification dated 13.6.2008. . S ..*lt is contended that Section 47 or any other provisions of S " the SEZ Act cannot be read with any other provision of law unless 2% 35 the provision SEZ Act requires that to be done specificaliy or generally. It is further contended that Section 4 of the Customs Act has been invoked by Notifications to enabie the officers under the SEZ Act to exercise powers under the. Customs A(:t"'ou_'t--side the SEZ for a iimited area and for a limited purposxexinv i' check the possibility of smuggling out of :t's~'-5,7,. It is emphasized that thereis no atternpt to u_se"e.xe3rnption"~_ provision in Section. 25 ofthe Custo"ms'tAct toi'in1p'o:-zie The duty of export of these are preisieriVbeid~--.under the amended Scheduie of the Customs Tariff Act i._arid t'he.ViNfojtifications referred to above. wonky. fix. of duty to be levied within the ceiling of theyprescribed..r'ate_i"..'e<)f duty. Section 25 therefore has
--=.been i1ito":'st..e._I_i_\/fitze Iegaliy. The goods in question i'rniariui'as;ytureid and supplied to SEZs are not subject to levy'ofCent19a:li1.V_Excise Duty by virtue of exemption under section ii"~'«.___i'2~6(I)(c) "of__iit:he SEZ Act. It is contended that insofar as SEZS are _co.,ncerned, the 'exports' and 'imports' are defined as inciuding, if '=b.ri--nging goods from at domestic tariff area into a SEZ in terms of 3 37 overrides all other laws, exemption is required to be granted only to duties enumerated under Section 26 of the SEZ Act. Insofar as the decision of the Gujarat High_.CoLnft.VVs(3ught to "
be relied upon is concerned, it is stated it.hat:_tAh«;{?sarne ris"si.ibj'er;_t to .l challenge before the apex Court and"theref(irel ;taniiotlbc..,pressed into service in support of the petition.ers..aitd hence --S¢A€kvSi§ that the petition be dismissed.
6. In the'_1f.$1!ilt the questions that would fl A.
(i) "dutyl can be levied under the Economic Zones Act, 2005?
ivexport duty could be imposed under the Act, E962 while incorporating the definition expression "export" under the SEZ Act, 2005, " .V__i3i1ito the Customs Act, 1962'?
5
7. To answer these questions, we may briefly look at the provisions of the relevant statutes. The Customs Act, 3.9_y6?,_i Act to consoiidate and_zmiend the law relating to eus_ttfrns._'Und.e:i:._. . Section ?.(!5), the expression "duty" is defined meia't1--ia duty~'ot"._V V customs leviable under the said Act. "'Exp<--i1"t" i_si'defi*ned Section '.?,(18) to mean with its gramina:t~icai ztindieoginate expressions 'taking out of to iindiai. The expression "export. goods" 2(l9) to mean goods which are outside india and the section 2(2{)_) to mean in reiatioii any time. between their entry for export and thestéiine. xiyheii"i.they"_.a1ie exported and would include any
-iv.Qwnejf"o;:r persor'i"r1i_i_1_i_seif out to be "exporter". The expression i'i'ii113po1*t»"1"isidefiried under section 2(23) to mean bringing into I.ndiajfroii1 gtpipsiiatze outside India and "imported goods" is defined
-'«t___iu~nder seiztio-n 20.5) to mean any goods brought into India from a _pl--ace_oiutside India but does not include goods which have been ii"wwe_.E.e.ared for home eonstnnption. "Importer" is defined under 6 39 section '?..(26) to mean in relation to any goods at any time between their importation and the time when they are clee.red_'ifo_r home consumption. includes any owner or any pe.rsonfho'ld.i;nig.._" . himself out to be the importer. "India? is defined xS'e.c_t»io1*:_ 2(27) to include the territorial waters'~,__oi"*--_indie." Sectiori"~._li2~:. contained in Chapter ~V of thisi*~A'ct providyesu. as if otherwise provided unde_i"'~pthe for time being in force, the duties at such rates, as may be Act, 1975, or any other lawy.fQri_the:::'tii*ee' goods imported into or exportedlfrom 14 of the Act provides for the valuation of the .goods'fo"1'.ytl;e purposes of assessment and it is if " «.pr<)v.i_dedEt_herein that fortlie purposes of Customs Tariff Act, 1975 oreny' r.othye1'.f'oryithe time being in force wherein a duty of customs is c.h;1r'ge2i.blet' orr any goods by reference to other value, the value if such' go'ods shall be deemed to be the price at which such or l~iVl{e-giocids are ordineuily sold or offered for sale for delivery at the " '~ti'nie and place of importation or exportation as the case may be in 5 40 the course of international trade. Chapter~l.OA incorporating special provisions relating to a Special Economic Ztiriefifeite inserted by Act 20 of ?.()(}2'., effective from . same have been omitted vide Section 99-ofthep Fi--nance" V' with effect from l.l.5.20()7. Section during the above rrientioned pe1*iods=.:iVpi':wvided"
of the said Chapter and goods admitted to a SEZ__but ir1__ between the pi-ovisions' Of.' Chapters, the provisions. prevail. Section 76E pI'()Vl(l€(l:iiv.._ifiOI-- -of customs and Section 76?"
provided forlevyofittustoms} The SEZ was one of the measures by: the Gtiveiinirtent to promote exports from India. An i'a_ct" "passed and the Special Economic Zones Act, 20l)5._ibeca.i1nei:etlective 1().2.?.006. The Rules were notified on '"~__i:'lQ.2.20G6__l'and the Act, as already noted provides for the . ie~stab1.ishment., development and management of the SEZS for the "promotions of exports and for matters connected therewith. 5
outside. India by land, sea or air by any other mode whether physically or otherwise or receiving goods or services by a_ti'nit or developer from another unit or developer of the Aorta. different SEZ. ' Section 2(ZD) provides that [all other' "-Wi{}l'(1.$ii'~8,.I]Ci expressions used and not (l€flI1€Ll':u;"3._(.l€I' the Act, butiidefined _iunder_iW th_e Central Excise Act, 1944, theiiriidustriesii{Deyelobment and Regulation)Act, 1951, the§r1c,t)ime:,t2txl"'Act,"3,961, the Customs Act, 1962, and and Regulation) Act, .1992, shiaill.i,haVe7ithchieaiiingsrespectively assigned to them in those Acts.' ' V' A i ' For itiiilxfiii of " eohveriience, the definition of the expres;sion_s -~"e.x-p_o1't" and "import" defined under the SEZ Act '"a.r1d"Ehle e'xp1'essi()ns ¥""*'exp()1't', 'export goods', 'import' and s'.ithpoirtted:"~go'ods?has defined under the Customs Act, 1962, are reiterated _he1}e_uf1de.r in a tabular form, to readily discern the . differeaceis between the definitions under the two Acts:--
:5 44 It is seen that the G-ox-e'emment of India with a View to curtail the increasing price of steel products imposed export duty of 20% by introducing Heading nos.27 to 41 in thevyypfileélciond Schedule to the Customs Tariff Act, 1975 vide a1nentl_irier1t.' . Finance Bill dated 28.4.2008. TheMmGover_:'11r:ent_jvof»:lndia:
simultaneously issued Notification no.;'66/ZIQU3 prescribing the effective duty at to V-yari_io'usw steel " l products . This Notification was su-bslergtientlly'ameinded by Notification no.77/2008 ma '.f1utho1'ities held that supplies to :SE:Z;,s1'.fr<)n_1 2: Area should be treated asl'=exp_orts alnd»_opinetl_l*that' such supplies would attract export duty. "'i4Siii"lCexV't_l'1lc1Tt.3" wide--spread objections by the v4..vindt1stry'-scythe'Ministry Commerce and Industry, issued a letter l'wAhere'i'11..it,_"was:"'stated that the Department of Revenue had suggested that of steel products on which export duty is l"-«.,_.4applicable*~'should be permitted after payment of prescribed duty. It pursuant to this clarification that demands .Vl"'--t-yyeretl raised on the etitioners t.o a dut on ex ort of steel _' P P Y Y P 25 45 products. It is in that background that the petitioners were before this court. The levy of goods exported from India would be as per the definition. of 'export' under the Customs Act, l96H2'il,_uli2der Section 2(1_8_) of the Customs Act, as already seen, _ defined as taking goods out of India to a piace ()Litsidel:ind'i'a. "export goods" are likewise defined. Inthe 'sabs'encel"oi"--..ai=;;1y_' definition of "export" would nece_ssari1y have .to'ibe¥a's*»-..defined r C' under the Customs Act, 1962. Fopr.-purposes of the-S_E,Z;§Act and to facilitate Various benefits 'that he conferred on a SEZ territory in ordeif to keep artiificiatlly increasing in reiatioiiito. the 'oi;-ieratiolns__Tf1«oi:r2 SEZ, the SEZ Act has been introduced inl"o._rde.r not to_i'mp,ose any kind of domestic duties on
---the siV,:piplie_s made if t'o..t,h€.vSEZs. Apparently, the definition of .l"--5expoit'.'_ Act was meant also to cover supply of goods,_llfrom.the_ Domestic Tariff Area to SEZ. Thus, under section 2"(i__o1~f the S132 Act, corresponding exemptions have been if keeping in View that the goods used by the SEZ should be fastened with domestic. duty liability, nor from any import 5 46 duties when the SEZ imports and export duty was also exempt when the SEZ exports to any place outside India and clear that it was in order to avoid the full iI1Cidt':I1C.€§i:()l' * excise duty when goods are manufactur'ed*~in as Doinestic' Ta.ri"'f. Area and supplied to 21 SEZ unit, the godds which fr<5:ii~th'eV Domestic Tariff Area from the SE:Z"iwere "export. V For goods manufactured a provided exemption from excise were also made available on "into a SEZ treating the same as giurpose of the SE2 Act.
But, withggt duties from being imposed on the S132 units, thepiische1ne.'i._(>f5.:_'Draw--back being granted on such .dutie._s_l'l*.vasiV.adopted"by__.t_reating the supply made from DTA to a Section 7 of the SEZ Act provided that any gotidsliiprovgiured'irorn the DTA to a SEZ unit would be exempt A 'from thevpayment of taxes, duties or cess, under all enactments _ spec»if.ied in the First Schedule. It is thus clear that there was ll " absolutely no intention to levy any kind of duty on the goods 3 47 moving from a DTA into the SEZ. Though Section 53 of the SEZ Act provides that the SEZ shall be deemed to be outside the customs territory of India, for the-.4':"purp():;ie"i ' undertaking its authorised operations"the*« qpuestionii'~wouidX be whether a SBZ does not continue to be a.__pan_: and i'~)fi:I1i(}~ir'.ili.' ~. If a SEZ was to be treated as beingiot1tside_['nd"ia, there iwasmhardly any necessity under SeetioI;i4_'_I'2:6 custoiirnsii duty any goods which are imported exempt export duties when 26 which provides for exemptiiqnipiarid the exemptions are providedsinder 12' iays down that goods may be procured fioin.the. payment of duty, taxes and cess. "'~Thus.,':"if there is dii"l"i"l.Ei,.I1.Ui.ElCIUI'C in the DTA excise duty is not '--J§;vV'ied"on"'the entering the SEZ area. Likewise, no customs dutiiesa1'e when goods move from the DTA to a SEZ in *~___i'ierms of Rule. Rule 27 aiso lays down that procurement from A shail be without payment of duty and taxes. Export entitlements are also extended to the DTA units. It is seen that 8 48 when a DTA clears its goods to SEZ unit, the transaction is treated if it is a export from the DTA to the SEZ. A Bill of export is filed by the DTA unit and all duty paid is refunded to the DTA unit. by way of draw-back, rebate and so on. If exportiiduty is to be levied under Schedule wli to the Customs p it is onty if the goods supplied from the to S'EZ= if they are in export out of India. in the al:;'s'en'ce 'of "d_e'fi,n'it:i'o.n'of "export" undea" the SEZ Act, irei;dei=i.ng the transactiot_'1"'o»f.goodsr L' from a DTA into a SEZ to an expo'rt..."p'outside India,' ityvould be Wholly incongruous. As seen.r_front.the detiriition of "export", it indicates 21 DTA to the SEZ unit. "But, it does not indicate that a.;_i<.:t'ttpply ought t.o be treated as supply exp'orte.d..outside the territory of India as is the "dpefinit'i.osn"o_f"'?expert" under the Customs Act. Hence, it is not to holidiithat by a deeming fiction the supply to 21 S132 ii""«.'_VL'£'11it froiit,V__i3TA would amount to goods moving outside India. Thereftfilre, it is emphasized that Section 26 itself providing that no duty is payable by the S132 unit by way of exemption. 49 When the goods are re--imported into the SEZ unit and likewise, €Xp01'[S from SEZ also not subject to the duty under section 26. It was wholly unnecessary to provide for such exemptions'eiy_if'»lthe SEZ was treated as being outside India, in which case, jfl'"'1't':i'«El§"'».'i_:_'_l:()i"i,l,_'i_..v('l y neither be any import customs duty nor export customise as all purposes, SEZ would be outside iis'hic1j=ls,,_}'a'y:s_l down that a DTA supplier, supply'in_g'--~the to has L' to clear the goods " as in the ease oyf.ex"portsfp' eitheI'--i.1_ndei' bond or as duty paid goods and clairu'1'elb'atie._ Tilie '.'as in the case of exports" was ln[l'0(iLl:CGd to effeé;::tuate~.l.i't_heV "benefits for a supply carried out by. 'a .. unit and this rule cannot be equated v\}'it.hii £1 p'1't)yis'io:1:_ii.of an Act of plenary legislation to vrendetflheii the SEZ as being export outside India. 'ii-Ito note that it is in consonance with the over~ all any duty impact on DTA goods supplied to xSpEZ," provisions of the Customs, Excise Duties and ii ax Drawback Rules, 1995 promulgated under Section 75 'e'§..t-lie Customs Act were suitably amended only for this purpose, 5 50 where-by the definition of "export" was amended to read that it ought to be understood as taking out of India to a plac.e"»o'u.t_s'iwde India or "taking out from a place in a Domestic Tztrjiff Aifeaf" ' Special Economic Zone. This was ob'vi'ously oii _a.cje'ountl o.f}th'e. fact that per Rule. 27 read withvSect.ion__ 2l6Jd1'aw'i3_.;1ck. has allowed which is referable to the ls'ai:d=tiraw-bzlckttRules the V domestic tariff supplies a_nd- ;theiret'ore the amendment was made in the definition oVfVff'export":V it i incidentally, it';j:i:s--_'_br~ough;tto f..'.1'--1C:jp'L3,I1lll:6lI":1f:1ll(l);l1 of the Court that a similar afgunientf»wasl1:'fad~_t-_aneed with"i'eferei1ce to erstwhile EPZ units, when they the DTA, to be considered as being supplied. outside It:d'ia.,._ll.whereby the EPZ units were treated as anisland withi:::_I_iidi;; and to be not a part of India. Such "--..conte';1tio--nVwas flnegatived by the apex Court in the case of TI1érrnft.x' Pr!'tlirt_!é5'Lir71iteci vs. Collector 0fCu5I0mS. I992 61 ELT
-V352, the_efi.ect that imports made into India would be entitled for tire purpose of payment of countervailing duty to press into é export duty cannot be justified under the provisions of the Customs Act , 1962. This is apparent from the circuni_st_'a"n.ce-.that such a charging provision namely, Section 76F as introelucecli C' by inserting Chapter --1()A under the Cusitotns '_Ai.ct..:«' be-tag special provision relating to the SE23,it.hat'.Cha_ptert omitted by the Finance Act, 2007 the abseme oligthel newly added provision, goods as aforesaid, would amount e'iie,.niti,:..'j,'V-attracting levy of excise duty, event under the Customs the Apex Court in A.VF€rf%VkE_f1.di?i# llliS:4;§eillilg;;¢ Lxmza, AIR .1957 SC 657, in construing fiscal s.tatut_es;i_n de.ter1iiinin_g the liability of subject tax, one have regai'dvto..the strict letter of the law an.d not merely w'tth:e"'sD'ii7itcoi* statute or the substance of the law. If the reventile sgttislfiezsilithe Court that the case falls strictly within the 'provision»s__of the law, the subject. can be taxed. "If, on the other _hand, the. case is not covered within the four corners of the provisions of the taxing statute, no tax can be imposed by Z inference or by analogy by trying to probe into the intentions of the Legislature and by conside.ri1ig what was the substa11eee..ot"e.the matter.
A reading of Rule 23 of the _S.'E;Z._'Rui'es;" fwotilici indicate that supplies from the DTA for export benefits as admissible uiitier the F__'l"P.._i '~Th'efp1'oe'edure"x V to claim such benefits is p~t_ovided"'u'niderii"Rules '2i4*andi30. Rule 27 permits a unit or a developer?"t,inde;:,_iti1e=.S'z3Z to import or procure from t'hei:D.i'"i'A Halli typeswoif -gooclwsfiwithout payment of duty or procure 'ifioiyn the such igoiods after availing export entitlerne--nts'--f 7i"his_{':'-~vvoalél._:lead "to the conclusion that export entitlements'avaflable ix.i)n~aiCcount of either the export of goods if " ~.fl'(")I}-lp_jfil1€;p_b'l'A to are available either to the DTA supplier tor" a ..or-pa deveioper, at their option. Therefore, duty drawaback, other export benefits would be available to either i "party their option. Such provision exempts goods brought in by if unit from all levies and duties and since the duty is " "leviable on the goods, it is not rational to contend that the export 3 SEZ Act. The levy of customs duty on exports sanctioned by Entry----83 of List-I of the V11 Schedule to the C0nStltL1tl(3Vflt_:
The respondents seeking to rely on the pr(ryy}--sit)hs~:.§('>f SEZ Act would render the provisions u1itio'ns.titutio_naies 3' lejyy 'of V customs duty on export of goods from iindia .c_an'n.ot«. beii'wiith_ reference to the provisions of theiiSEiZ» Act. "l7he"Aai:=thorities under V the SEZ Act are Hienforce the liability which could a1'ise...ori_'ty the Act. Hence, the instructi'_(_).nsi the impugned be sustained. It is therefore, declareidtliat as «mid be payable for supply of goods by theparties the. petitioners in the SEZs'"and al..ig_4'iproceed_ings iin«it.iated in this regard are therefore liable to it The petiiitioriis areiallowed accordingly. Sd/-3 JUDGE