By TIOL News Service

HYDERABAD, JULY 19, 2016: THE question involved in the Writ Petitions is - what is the effective date of Notification No 36/2001 Cus (NT) dated 03.08.2001? Is it effective from 03.08.2001 as claimed by the CBEC vide Circular No 46/2001-Cus, Dated : August 10, 2001 or from 06.08.2001, when the gazette was made available to the public.

The issue has already been decided by the Supreme Court in case of Union of India v. Param Industries Ltd - 2015-TIOL-140-SC-CUS, wherein it was held that Notification No.36 of 2001 came into force only with effect from 06.08.2001 and, consequently, the tariff value prescribed under the said notification cannot be applied retrospectively on the goods imported earlier on 03.08.2001.

But what makes these Writ Petitions interesting is they are before the very same High Court, a Division Bench of which had held that the Notification comes into effect from 03.08.2001 in M/s K.G.F. Cotton Pvt Ltd in W.P. Nos. 18440, 20373 and 18466 of 2001, decided on 20-2-2013, while dissenting with the judgment of Karnataka High Court in Param Industries case and relying on the judgements of the Supreme Court in case of M /s. Pankaj Jain Agencies Vs UOI and UOI Vs Ganesh Das Bhojraj . Can the High Court rule the Supreme Court decision in case of Param Industries Ltd as per incuriam ?

The High Court observed:

+ Can the High Court hold that the Division Bench judgment of the Supreme Court in Param Industries Ltd is per incuriam as it was rendered in ignorance of the earlier Division Bench judgments of the Supreme Court in M/s. Pankaj Jain Agencies and Ganesh Das Bhojraj ? Is it open to the High Court to hold, on the material on record, that Notification No.36/2001 came into force on 03.08.2001 itself, and thereby negate the decision of the Supreme Court in Param Industries Ltd that the said Notification No.36/2001 came into force on or after 06.08.2001?

+ It is impermissible for the High Court to hold that Notification No.36/2001 came into force on 03.08.2001 for the reason that it was published in the Official Gazette on that day, as that would fall foul of the judgment of the Supreme Court, in Param Industries Ltd, wherein the very same Customs Notification No.36/2001 was held to have come into force on or after 06.08.2001, and not on the date of its publication as reflected in the Gazette as 03.08.2001. Article 141 of the Constitution stipulates that the law declared by the Supreme Court shall be binding on all courts within the territory of India.

+ The singular Constitutional role of the Supreme Court under the Constitution, and correspondingly of the assisting role of all authorities - civil or judicial in the territory of India - towards it, mandates the High Court, which is one such judicial authority covered under Article 144 of the Constitution, to act in aid of the Supreme Court. The order of the Supreme Court is a judicial order, and is otherwise enforceable throughout the territory of India under Article 142 of the Constitution. The High Court is bound to come in aid of the Supreme Court in having its order worked out. While the High Court is independent, and is a co-equal institution, the Constitutional scheme and judicial discipline requires that the High Court should give due regard to the orders of the Supreme Court which are binding on all Courts within the territory of India.

+ As the Supreme Court, in Param Industries Ltd, has held that Notification No.36/2001 came into force on or after 06.08.2001, the action of the respondents in applying the tariff value prescribed therein, for the earlier import of R.B.D. Palmolein oil on 03.08.2001, is illegal. Customs duty on R.B.D. Palmolein oil, imported on 03.08.2001, could only have been levied on its invoice value, and not on the tariff value prescribed subsequently in Notification No.36/2001 dated 03.08.2001. Both the Writ Petitions are allowed.

(See 2016-TIOL-1429-HC-AP-CUS)