Chaini Parwani –
Published On: October 26, 2021 at 13:45 IST
The Madras High Court Observed that Lubricants cannot be considered to be Excisable Goods for purposes of the Sabka Viswas (Legacy Dispute Resolution) Scheme, 2019 (SVLDRS).
The Bench of Justice Anitha Sumanth noted that there is no argument with the proposition that exempt goods continue to be excisable goods, though the rate of duty is prescribed as ‘Nil’.
Further the Bench observed that it is Nobody’s Case that lubricants are Exempt from Central Excise Duty and they figure as Goods under Schedule 4.
Furthermore, Justice Sumanth noted that SVLDRS Scheme has been brought in to eliminate pending Litigations where potential and where the litigation falls within the limits set out under the Scheme.
Justice Sumanth also noted that the evaluation of the clause under the Scheme must be subsequent with this acknowledged object and any conflict that arises in interpretation must be Adjudicated in favour of the Assesse.
The Court highlighted the Case of Moti Laminates stating that in the Case Hon’ble Supreme Court provides guidance on how the term ‘Excisable’ should be understood and Interpreted.
The Court further Stated that “Section 125(h) specifically uses the term ‘Excisable goods’. The rate of duty mentioned alongside lubricants under the 4th schedule is ‘…….’ and as rightly clarified by the Departmental Officer on Special Duty, it is only some of the products in the 4th schedule, such as Petroleum crude, High-speed Diesel, Motor Spirit, Natural gas, Aviation Turbine Fuel and Tobacco and Tobacco products, that are to be construed as ‘Excisable goods’ to determine the exclusions under the SVLDRS Scheme.”
Furthermore, the Court observed that the 101st amendment Replaces Entry 84 of the Union List to state that duties of excise shall be on the following goods manufactured or produced in India, namely, Petroleum Crude; High-speed Diesel; Motor spirit (commonly known as petrol); Natural gas; Aviation Turbine fuel; and Tobacco products and that the interpretation of Section 125 of the Scheme has to be examined in this context only as otherwise, the object of the Scheme will not be achieved.
The Petitioner, M/s. Indian Oil Corporation Limited is involved in the manufacture of lubricants that come under Chapters 27, 34, and 38 of the First Schedule to the Central Excise Tariff Act, 1985.
The supply was made without the Remittance of duty on the strength of exemption Orders submitted during the period September 2013 and June 2014, as per which, supplies made in opposition to International competitive bidding to power projects did not carry the Incidence of duty.
The Petitioner, a Public Sector Undertaking has Argued an Order passed by the sole Respondent, Commissioner of Central Excise and GST dismissing the application of the Petitioner for settlement of Disputes under the Sabka Viswas (Legacy Dispute Resolution) Scheme, 2019.
