Holding

The Finance Act’s tariff rates are the law of the land; budget proposals are not enactments, and the court cannot compel the government to issue a notification or find discrimination, so the appeals are dismissed.

Summary

Amin Merchant imported eight consignments of goods classified under Customs Tariff sub‑heading 2208.10 and paid duty at the rate of Rs 300 per litre or 400% whichever was higher, as prescribed in the Finance Act. He contended that the Finance Minister’s budget proposals for 1993‑94 and 1994‑95 required a lower duty (85% and 65% respectively) and sought a mandamus directing the Central Government to issue a notification under s.25 of the Customs Act to exempt the duty, a refund of the excess duty and interest. The Bombay High Court dismissed the writ and review petitions, holding that the budget proposals are not law and the Finance Act’s tariff is the authoritative expression of Parliament’s will. On appeal, the Supreme Court affirmed that budget proposals are merely policy statements, not enactments; the tariff in the Finance Act is valid, the court cannot direct the government to issue a notification, and there was no discriminatory classification violating Art 14. Consequently, the appeals were dismissed.

Issues considered

Whether the Finance Minister’s budget proposals, as alleged by the appellant, were duly passed and approved by Parliament and whether the tariff rates fixed by the Tariff Research Unit are contrary to the legislative mandate.
Whether the Court can direct the Central Government to issue a notification under Section 25(1) of the Customs Act, 1962.
Whether compound alcoholic preparations of a kind used for manufacturing beverages fall within the category of alcoholic beverages.
Whether there is discrimination by the Central Government in issuing notifications under Section 25(1) of the Customs Act, violating Article 14 of the Constitution.

Legislation cited

Constitution of Indias. Article 14, s. Article 19(1)(g), s. Article 265, s. Article 300A
Customs Act, 1962s. 159, s. 25

Subjects

Customs dutyTariff classificationBudget proposalsJudicial reviewTaxationArticle 14Section 25DiscriminationMandamusFinance Act

Judgment

[2016) 4 S.C.R. 488

A AMIN MERCHANT
v.
CHAIRMAN, CENTRAL BOARD OF EXCISE & REVENUE &
ORS.

B (Civil Appeal Nos. 4676-4677 of2013)
JULY 22, 2016
[MADAN B. LOKUR AND N.V. RAMANA, JJ.)
Judicial review: Interference of the court sought by assessee
C on the ground that rate prescribed for goods under tariff heading
is higher than that authorised in the Budget proposals put forth by
the Finance Minister - Held: Proposals of the Finance Minister in
Parliament are not the enactments of the Parliament - Even assuming
that the amount of tax is excessive, in the matters of taxation laws,
the Court permits greater latitude to the discretion of the legislature
D and it is not amenable to judici~l review - Tax/Taxation.
Customs Act, 1962: s.25 - Power to grant exemption from
duty - Held: s.25 delegates power to the Central Government i.e.
· the executive branch to grant exemption generally from duty
whenever it finds that it is necessary to do so in the larger public
E interest either absolutely or subject to such conditions as may be
specified in the notification or by a special order in ea<!h case under
exceptional circumstances.
Constitution of India: Art.14 -A Taxing Statute can be held
to contravene Article 14 of the Constitution if it purports to impose
qertain duty on the same class of people differently and leads to
F obvious inequality - When the assessee alleges discriminatory action
on the part of the revenue, he has to establish that there is no rational
basis for making classification between the goods which are notified
and the goods of the appellant which are not notified.
Dismissing the appeals, the Court
G
HELD: 1. Every legislation is done with the object of public
good. Taxation is a unilateral decision of the Parliament and it is
the exercise of the sovereign power. The financial proposals put
forth by the Finance Minister reflects the governmental view for.
raising revenue to meet the expenditure for the financial year
H and it is the financial policy of the Central Government. The
488
AMIN MERCHANT v. CHAIRMAN, CENTRAL BOARD OF 489
EXCISE & REVENUE

Finance Minister's speech only highlights the more important A
proposals of the budget. Those are not the enactments by the
Parliament. The law as enacted is what is contained in the Finance
Act. After it is legislated upon by the Parliament and a rate of
duty that is prescribed in relation to a particular Tariff Head that
constitutes the authoritative expression of the legislative will of
B
Parliament. Now in the facts of this case, as per the finance bill,
the legislative will of the Parliament is that for the commodities
falling under Tariff Head 2208.10, the tariff is Rs.300/- per litre
or 400% whichever is higher. Even assuming that the amount of
tax is excessive, in the matters of taxation laws, the Court permits
greater latitude to the discretion of the legislature and it is not c
amenable to judicial review. [Para 31] [500-D-F]
2. As per Section 159 of the Act, any notification issued
under Section 25 shall be placed before the Parliament and the
Parliament may amend or reject the same. This clearly
demonstrates that the ultimate law making power is vested with
D
the Legislature. Hence, the allegation of the appellant that the
notifications are issued basing on the whims and fancies of the
2"d, respondent is misconceived. Whereas, notifications are issued
generally in the larger public interest, the Legislature has given
the power to exempt duty to the 2"d respondent subject to the
amending power. In the matter of taxation, the Court gives a "E
greater latitude to the legislative discretion. , [Para 32] [501-G-
H; 502-A-B]
3. When the appellant alleges discriminatory action on the
part of the respondents, he has to establish that there is no rational
basis for making classification between the goods which are F
notified and the goods of the appellant which are not notified. It
is also a firmly established principle that the legislature
understands and appreciates the needs of its people. A Taxing
Statute can be held to contravene Article 14 of the Constitution if,
it purports to impose certain duty on the same class of people
differently and leads to obvious inequality. Such a material is not G
placed to prove that the action of the respondents is
discriminative. Hence, the same is held against the appellant.
[Paras 34, 35] [502-F-G]
Bussa Overseas and Properties (Pvt.) Ltd. v. Union of
India 1991 (53) ELT 65 (Bom.) Seagram H
490 SUPREME COURT REPORTS [2016] 4 S.C.R.

A Manufacturing Ltd. v. Commissioner of Customs, New
Delhi 2003 (154) ELT 610 (Tri.Del.) Sandvik Asia Ltd.
v. Commissioner of Income Tax, Pune (2006) 150
TAXMAN, 591 (SC); Choksi Tube Co. v. Union of India
1998 (97) ELT 404 SC"-Mohammed Yasin l( Town Area
Committee, Jabalpur & Anr: AIR 1952 SC 115 : 1952
8
SCR 572; B.K. Industries v. Union of India (1993) 65
ELT 465 (SC); Union of India v. Jalyan Udyof? 1993
(68) ELT 9 (SC) - referred to.
Case Law Reference
1991 (53) ELT 65 (Born.) referred to Para 9
c
2003 (154) ELT 610 (Tri.Del.) referred to Para9
(2006) 150 TAXMAN, 591 referred to Para 12
1998 (97) ELT 404 SC referred to Para 13
1952 SCR 572 referred to Para 14
D (1993) 65 ELT 465 (SC) referred to Para 16
1993 (68) ELT 9 (SC) referred to Para 17
ClVILAPPELLATE JURISDICTION: Civil Appeal Nos. 4676-
4677 of2013.

E From the Judgment and Order dated 02.09.2011 of the High Court
of Judicature at Bombay in Writ Petition No. 1761 of2009 and 24.11.2011
in Review Petition No. 24 of20l l.
Amin Merchant, Appellant-in-Person.
K. Radhakrishnan, Sr. Adv., Ms. Nisha Bagchi, Ms. Binu Tamta,
F 8. Krishna Prasad, Rajiv Singh, Ms. Pooja Sharma, Ms. Nikita
Shrivastava, Advs. for the Respondents.
The Judgment of the Court was delivered by
N. V. RAMANA, J. I. These appeals, by special leave, have
been filed against the impugned judgment and order dated 02.09.2011 in
G Writ Petition No.1761 of 2009 and order dated 24.11.2011 in Review
Petition No.24 of201 l·in Writ Petition No.1761 of2009 respectively, of
the High Court of Judicature at Bombay, by which the High Court has
dismissed the Writ Petition filed by the appellant herein and also dismissed
the Review Petition by holding that no error apparent on record has
H been made out.
AMIN MERCHANT v. CHAIRMAN, CENTRAL BOARD OF 491
EXCISE & REVENUE [N. V. RAMANA, J.]

2. The facts leading to these appeals, in brief, are that the appellant A
imported eight consignments of goods falling under Tariff Sub-Heading
2208.10 of the Customs Tariff, namely, "Compound alcoholic preparations
of a kind used for the manufacture of beverages" during the financial
years 1993-94 and 1994-95. The customs authorities assessed the goods
imported provisionally and subjected them to a prescribed rate of duty of
B
Rs.300/- per liter or 400% whichever is higher specified in respect of
Sub-Heading 2208.10 of the Customs Tariff for 1993-94 and 1994-95.
The appellant claims to have deposited the amount of duty provisionally
assessed on the assessable value declared in the eight bills of entry.
According to the appellant, he cleared the goods for home consumption
during financial years 1993-94 and 1994-95. Between the years 1994 c
and 2001 the appellant addressed several communications, inter alia,
to the Central Board of Excise and Customs and to the Tariff Research
Unit (TRU) of the Union Ministry of Finance. The grievance of the
appellant is that the rate which has been prescribed for goods falling
under Tariff Sub-Heading 2208.10 is higher than that was authorized in
D
the Budget Proposals during financial years 1993-94 and 1994-95. The
appellant took recourse to the provisions of the Right to Information Act
in order to procure relevant information from the concerned authorities.
According to the appellant, the authorities have not furnished the relevant
information.
3. Not satisfied with the attitude of the authorities, the appellant E
preferred a Writ Petition before the High Court seeking the following
reliefs: (a) a writ of Mandamus directing the first arid second respondents
herein to issue a notification u/s.25( I) of the Customs Act, 1962 (for
short 'the Act') in order to exempt goods falling under Tariff Sub-Heading
2208.10 so as to give effect to the Budget proposal announcedoy the F
Finance Minister (FM) in Parliament for financial years 1993-94 and
I 994-95; (b) a direction to the Chief Commissioner of Customs to
finalize assessment of the eight bills of entry after a notification is issued
by the first and second respondents u/s.25( I) of the Act; (c) a writ of
Mandamus directing the second respondent to issue a notification u/
s.25(2) of the Act for granting exemption from customs duty for goods G
falling under Tariff Sub-Heading 2208.10 for financial years 1993-94
and 1994-95; (d) an order for refund after assessments are finalized and
(e) an order for the payment of interest at the rate of 12% p.a. on the
refund that is ordered. ·
4. The High Court has dismissed the Writ Petition by the impugned H
492 SUPREME COURT REPORTS (2016] 4 S.C.R.

A judgment and order dated 2.9.2011 . Being dissatisfied with the dismissal
of his writ petition, the appellant prefe1Ted a Review Petition, which was
also dismissed by the High Court by the impugned judgment and order
dated 24.11.2011.
5. Heard the ap_pellant, appearing in person, and learned Senior
B Counsel for the respondents.
6. The appellant, appearing in person, vehemently submits that
the budget proposals for 1993-94 stipulated, inter alia, a reduction in
effective rate of import duty on items which had then attracted a rate of
duty higher than 85%, to 85% advaforem, except.on dried grapes,
almonds, alcoholic beverages, ball and roller bearings and passenger
c baggage; the Budget proposals for 1994-95 similarly contemplated a
reduction in effective rates of customs duty on items which until then
attracted a duty higher than 65%, to 65% except, inter afia, on alcoholic
beverages. 'CAP of a kind used in the manufacture of beverages' falling
under sub-heading 2208.10 of the Act are not covered by the said
D exceptions 'dried grapes, almonds, alcoholic beverages, ball and roller
bearings and passenger baggage' as mentioned in the Budge proposal
appearing at Sl.No.B I. Hence the import duty on 'CAP of a kind used
in the manufacture of beverages' falling under sub-heading 2208.10 should
have been read as "85%" for the financial year 1993-1994 in keeping
with the Budget Proposal at Sl.No.B 1 duly passed by the Parliament for
E the financial year 1993-94 so also for the financial year 1994-95, it should
have been "65%".
7. The appellant would further submit that all the notifications
contained in the Explanatory Memorandum 1993-94 ;md 1994-95 were
to give effect to the Budget Proposals duly passed and legislated by the
F Parliament and rectify the erroneous tariff rates prescribed by the TRU
department in the Customs Tariff Act, Finance Bill and Finance Act for
1993-94 and 1994-95; Budget proposals announced by the FM in the
Parliament are duly passed and/or approved by the Parliament, no person,
executive, bureaucrat or any authority or Court of Law has the authority
and/or power to alter or amend the same. If the executives are allowed
G
to prescribe any tariff rates contrary to the Budget Proposals duly
authorized by the Parliament, then the Budget Proposals duly passed by
the Parliament will have no meaning and will be rendered nugatory and
thus opening the flood gates for 'corrupt practice'.
8. He also submits thatthe goods falling under sub-heading 2208.10
H
AMIN MERCHANT v. CHAIRMAN, CENTRAL BOARD OF 493
EXCISE & REVENUE (N. V. RAMANA, J.]

of the Customs Tariff Act are not 'alcoholic beverages' but 'Compound A
alcoholic preparations of a kind used for the manufacture of beverages'
falling under sub-heading 2208.1 0 in the Customs Tariff Act 1993-94
and 1994-95, not being 'alcoholic beverages' and not being covered by
the exceptions mentioned in the said proposal at SI.No. BI, the rate of
duty duly passed and legislated by the Parliament should have been
B
prescribed as 85% for the year 1993-94 and as 65% for the year 1994-
95. The statutory term 'Compound alcoholic preparations of a kind
used for the manufacture of beverages' clearly explains that it covers
compound alcoholic preparations for the manufacture of beverages and
that it is a product that precedes the consumable.'alcoholic beverage'
and hence it cannot, by any stretch of imagination, be equated to and or c
termed as 'alcoholic beverages' in itself. If "Compound alcoholic
preparations of a kind used for the manufacture of beverages' are sought
to be included in the term 'spirits, liquors and other spirituous beverages'
and or sought to be treated as' Alcoholic Beverages' then the statutory
term 'Compound alcoholic preparations of a kind used for the
D
manufacture of beverages' distinctly falling under sub-heading 2208.10
will be redundant and such a perverse interpretation is not permissible
as it will alter the statutory heading 22.08 and sub-heading 2208.10 in
the Customs TariffAct, 1975. He would further submit that Harmonized
System ofNomenclature (HSN), an International Regulation evolved
in 1986 by the Customs Co-operation Council, Brussels, which is adopted E
by the Govt. oflndia, clearly recognizes that 'CAP of a kind used in the
manufacture of beverages' are distinct and different products from
'alcoholic beverage' which are intended for immediate consumption and
in the said HSN Explanatory Notes dealing with sub-heading 2208 it is
expressly stated that "these preparations are not intended for immediate
F
consumption and thus can be distinguished from the liquors and other
spirituous beverages of this heading".
9. In this connection, he places reliance on a Judgment of the
Bombay High Court in Bussa Overseas and Properties (Pvt.) Ltd. Vs.
Union of India, reported in 1991 (53) ELT 65 (Born.), wherein the
Bombay High Court, while dealing with classification has held that goods G
falling under sub-heading 2208.10, namely, 'CAP of a kind used in the
manufacture of beverages' are not consumable as such, have to be sold
to the distilleries where they undergo a process and cannot be treated as
Whisky, Gin or Brandy as known in the trade. Against the said decision,
Union oflndia has preferred S.L.P.(C)Nos.13194-210/J 991 in this Court
H
494 SUPREME COURT REPORTS [2016] 4 S.C.R.

A wherein this Court has dismissed the aforesaid SLPs upholding the
decision of the Bombay High Court.
10. He also places reliance on a judgment of the High Court of
Delhi in Seagram Mtml{facturing Ltd. Vs. Commissioner ofCustoms,
New Del/ti, reported in 2003 (154) ELT 610 (Tri.Del.), which is
affirmed by this Court reported in 2004 ( 163) ELT A 205 (SC) wherein
B
this Court, confirming the views of the Tribunal regarding classification,
held that 'goods' falling under sub-heading 2208.10 are not intended for
immediate consumption and are not 'alcoholic beverages and are.
classifiable under sub-heading 2208.10 of Customs Tariff'.
11. He would further submit that the TRU department has issued
c notifications for all other erroneous tariff rates prescribed by them in the
Customs Tariff Act, Finance Bill and Finance Act 1993-94 and 1994-95
to give effect to the Budget proposals duly passed and legislated by the
Parliament and the respondents cannot discriminate in the case of the
appellant and refuse to issue notifications.
D 12. He further submits that he is seeking a suitable notification
prescribing Customs Tariff of85% and 65% on goods falling under sub-
heading 2208. l 0 to give effect to the budget proposals at Sl.No.B 1 duly
passed and legislated by the Parliament for the years 1993-94 and 1994-
95 since collection of tax without authority oflaw is in violation ofArticle
265 of the Constitution and violation of the appellant's right to property
E
under Article 300 A of the Constitution and return of the excess amount
ofRs.5,62,46,722/- (Rupees Five core sixty two lakhs forty six thousand
seven hundred and twenty two only) collected from him at the time of
provisional assessment for imports made during the years 1993-94 and
1994-95 with simple interest @ 12% p.a. On the point of interest, he
F . would submit that the respondents are liable to pay interest on the excess
duty unlawfully collected from him since 1993-94 and 1994-95 and having
retained the same since the last 20 years. In this connection, he places
reliance on Sandvik Asia Ltd. Vs. Commissioner of Income Tax,
Pune, reported in [(2006) 150 TAXMAN, 591 (SC)].
G 13. He would fm1her submit that the Courts can, in exceptional
circumstances like the present one, compel officers of Respondent No.2 ··
to issue appropriate notification u/s.25(2) of the Customs Act, 1962, in
order to give effect to the Budget Proposals so as to levy duty on the
appellant's imports only at 85% for the F. Y. 199-94 and 65% for the F. Y.
1994-95. In this connection, he places reliance on a judgment of this
H Court in Clwksi Tube Co. Vs. Union of India repo11ed in 1998(97)
AMIN MERCHANT v. CHAIRMAN, CENTRAL BOARD OF 495
EXCISE & REVENUE [N. V. RAMANA, J.]

ELT 404 SC. A
14. He would further contend that the respondents/revenue have
illegally collected import tax/import duty without any authority of law
and deprived the appellant of profits of the said amount of Rs.5,62,46, 726/-
since 1993-94 and 1994-95 and thereby put an unreasonable restriction
on the appellant's fundamental right as guaranteed by Article 19( 1)(g) B
of the Constitution, to carry on his trade and business since 1993-94 and
1994-95. In support of this contention, he places reliance on a Judgment
of this Court in Mohammed Yasin Vs. Town Area Committee, Jabalpur
& Anr. reported in AIR 1952 SC 115.
15. Per contra, learned Senior Counsel for respondents would
submit that the speech of the Finance Minister while presenting the
c
Budgetary Proposals only highlights the more important proposals pf the
Budget; Budgetary changes are, in fact, enacted by the Parliament as
contained in the Finance Bill or ratified by Parliament or implemented
through notifications. The legal force for charging a particular rate of
customs duty on import of goods, is derived from the First Schedule of D
the Customs Tariff Act, 197 5 read with notifications issued u/s.25( 1) of
the Act. If any changes in the rates were intended by Parliament it
would have been reflected in the respective Finance Bills.
16. He further submits that there was no error or discrepancy
between the budget proposals announced by the Finance Minister and
E
the Finance Bill. According to him, the High Court has rightly held that
the appellant did not dispute the fact that the goods imported by him fell
within Tariff Heading 2208.10 and the position under the Finance Act of
1993 was that the rate of duty prescribed for Tariff sub-heading 2208.10
was Rs.300/- per liter or 400% whichever is higher and the High Court
thus rightly held that budget proposals and the speech of the Finance F
Minister in Parliament may or may not accept the proposal as held in
B.K. Industries V. Union of India reported in (1993) 65 ELT 465
(SC) and once Parliament has duly legislated, and a rate of duty is
prescribed in relation to a particular tariff heading that constitutes the
authorities' expression of the legislative will of Parliament; the speech
G
of the Finance Ministerand the financial/budget proposals duly passed
by Parliament are two separate and distinct documents; the Jaw as
enacted is what is contained in the Finance Act after it is legislated upon
by the Parliament. Budgetary proposals constitute legislative material
antecedent to the enactment of Jaw. The rates of tax are those which
are prescribed by legislation, once it is enacted by Parliament. It is the H
496 SUPREME COURT REPORTS [2016] 4 S.C.R.

A law as enacted, which gives expression to legislative will and it is the
law as enacted which prescribes the rate of tax which Parliament has
duly imposed. Consequently, as a matter of first principle, it would be
impermissible for the Court to undertake the exercise of entering upon a
scrutiny of the correctness of the collective expression oflegislative will
which finds expression in the legislation as adopted by the Parliament.
B
17. In his submission, the Court cannot undertake a scrutiny of
whether there was an error on the part of the Par! iament in legislating to
provide a particular rate of duty. The power to issue a notification u/s.
25(1) of the Act has been conferred upon the Central Government where
it is satisfied that it is necessary in the public interest so to do. Under
c sub-section (2) of Section 25, the Central Government may, where it is
satisfied that it is necessary in the public interest so to do, by special
order in each case, exempt from the payment of duty, under circumstances
of an exceptional nature to be stated in such order, any goods on which
duty is leviable and this Court has observed in the case of Union of
D India Vs. Jalyan Udyog reported in [1993(68) ELT 9 (SC)/ that "the
Parliament cannot constantly monitor the needs of and the emerging
trends in the economy and is in no position to engage itself in day-to-day
regulation and adjustment of import-export trade. Accordingly, the power
is conferred upon the Central Government to provide for exemption from
duty of goods, either wholly or partly and with or without conditions, a~
E may be called for in public interest. We see no warrant for reading any
limitation into this power."
18. According to him, the Government of India i.e. the TRU is
fully empowered to decide the quantum of levy of duty on a particular
commodity and to define it. Therefore, no wrong was committed by the
F TRU when it held that the commodity imported by the appellant did not
enjoy the peak duty structure of 70% but fell unde_r the exceptions and
replied to the appellant accordingly. The Court, therefore, would not be
justified in directing the. Central Government to issue a notification in this
case.
19. He would further contend that the goods imported by the
G
appellant were cleared provisionally on payment of duty prescribed in
the Customs Tariff Act, 1975; the imported compound alcoholic
preparation was known as "concentrated extracts". Compound Alcoholic
Preparations are used in the manufacture of various beverages and are
not for immediate consumption. The claim of the appellant-importer
H that duty should have been imposed at the rate of 85% for 1993-94 and
AMIN MERCHANT v. CHAIRMAN, CENTRAL BOARD OF 497
EXCISE & REVENUE [N. V. RAMANA, J.]

65% in 1994-95 and the claim that he had paid excess duty of A
Rs.5,62,46, 726/- cannot be sustained since all these consignments were
assessed provisionally and the goods were classified under Chapter Tariff
Heading No.2208.10 of the First Schedule to the then Custom Tariffand
accordingly, the goods were assessed provisionally and cleared on
payment of appropriate duties.
B
20. According to him, the further contention of the appellant-
importer that exclusion in peak rate covers alcohol beverages but his
imported goods are "compound alcoholic preparation of a kind used for
manufacturing of beverages" which is not alcohol beverage and,
therefore, not hit by the exclusion clause, cannot also be sustained.
21. According to him, the contention of the importer that during
c
the impugned period, the peak rate of duty was 150% as announced by
the FM in his Budget Speech also cannot be sustained because the
proposed rate of maximum 150% was applicable to goods other than
alcoholic beverages and passenger baggage. The speech of the FM in
this regard was very clear and there is no ambiguity in the speech. D
Alcohol beverages and passenger baggage have been taken out of the
cover of maximum 150% rate duty. Hence the contention of the appellant-
importer that the impugned imported goods were covered by FM speech
for 150% rate duty is incorrect and in fact this is contrary to what was
contemplated in the Customs TariffAct, 1975 and the HSN Explanatory
E
Notes.
22. We have considered the extensive arguments submitted by
the appellant/party-i11-person and gone'through the voluminous record
placed before us and the respective submissions of the learned senior
counsel for respondents.
23. Before adverting to the various arguments advanced by both F
sides and the findings recorded by the Court below, we deem it appropriate
to extract the relevant Tariff Entry 2208.10 under the Customs Tariff
1993-94 and 1994-95, which reads:
Heading Sub- Description of article Rate of du!Y
No. heading Stand- Preferential G
No. ard areas
22.08 2208.10 Compound alcoholic Rs.300 per litre or
preparations of a 400% whichever is
kind used for the higher ....
manufacture of
beverages.
H
498 SUPREME COURT REPORTS [2016) 4 S.C.R.

A, 24. Though it was already discussed in the preceding paragraphs
about the reliefs sought by the appellant before the High Court, we deem
it appropriate to extract the same hereunder:
"( 1) a writ of Mandamus directing the first and second respondents
to issue a notification under Section 25( 1) of the Customs Act, 1962, in
B order to exempt goods falling under Tariff Heading 2208.10 so as to give
effect to the budget proposal announced by the Finance Minister in
Parliament for financial years 1993-94 and 1994-95; (2) a direction to
the Chief Commissioner of Customs to finalize assessment of the eight
bills of entry after a notification is issued by the first and second
respondents under Section 25(1) of the Customs Act, 1962; (3) a writ of
c Mandamus directing the second respondent to issue a notification under
Section 25(2) of the Customs Act, 1962, for granting exemption from
customs duty for goods falling under Tariff Heading 2208.10 for financial
years 1993-94 and 1994-95; (4) an order to refund after assessments
are finalized and (5) an order for the payment of interest at the rate of
D 12% p.a. on the refund that is ordered."
25. The High Court of Bombay, after giving a thorough
consideration, dismissed the writ petition on the ground that once a
particular Tariff Heading is prescribed, that constitutes the authoritative
expression of the legislative will of Parliament and the High Court cannot
E exercise its power ofjudicial review and go beyond the law enacted by
the Parliament and it is not permissible for the Court to undertake a
scrutiny of whether there was an error on the part of the Parliament in
legislating a particular rate of duty. Further, the High Court observed
that there is no discriminatory conduct which would compel the
interference of the court. The appellant, unsatisfied with the order, has
F preferred a revision before the High Court which ended up in dismissal
as no error apparent on record has been made out.
26. In those circumstances, the appellant is before us by way of
these appeals; one arising out of the original order and one against the
order passed in review. Before this Court, the appellant has amended
G the reliefs and sought for the following reliefs: ( 1) direct the respondents
to perform their duty to issue suitable notification to rectify the erroneous
rate of duty prescribed on sub-heading 2208.10 and to implement and
execute the tariff rate already legislated; (2) direct the respondents to
return the excess amount of Rs.5,62,46, 722/- collected without any
H authority of law; (3) direct the respondents to pay 12% simple interest
AMIN MERCHANT v. CHAIRMAN, CENTRAL BOARD OF 499
EXCISE & REVENUE [N. V. RAMANA, J.]

for having willfully and deliberately refused to rectify the error. A
27. The appellant has come up before this Court with a voluminous
record and made submissions at length. The gist of the first and foremost
grievance of the appellant appears to be that he was charged with the
duty@ Rs.300/- per litre or 400% which was already paid by him for
the goods he imported as per the provisional assessment. B
28. According to him, the Finance Minister has presented the
budget proposals before the Parliament which were duly approved by
the Par Iiament. As per the approved budget proposals, the goods imported
by him attracts reduction in duty higher than 85% to 85% advalorem for
1993-94 and higher than 65% to 65% ad valorem for the year 1994-95 c
and he does not fall under the exception of alcoholic beverages. The
tariffhe was charged and the tariff rates in the finance bill are contrary
to the approved budget proposals.
29. The second grievance appears to be that whenever the tariff
rates are erroneously prescribed, the 2"d respondent is issuing notification D
and iti fact they have issued 85 notifications for the financial year 1993-
94 and 94 notifications for the financial year 1994-95. The 2"ct respondent
is discriminating the appellant by refusing to issue a circular in respect of
his goods; as such their action is discriminatory and violative of Article
14 of the Constitution oflndia.
E
30. In view of the aforesaid rival submissions, the issues that fall
for consideration are:
I) Whether the budget proposals, as alleged by the appellant,
are duly passed and approved by the Parliament and whether
the tariff rates fixed by the TRU are contrary to the
F
legislative mandate?
2) Whether this Cout1 can direct the Central Government to
issue a notification under Section 25( 1) of the Customs Act?
3) Whether the compound alcoholic preparations ofa kind used
for the manufacturing of beverages fall under the category G
ofalcoholic beverage?
4) Whether there is any discrimination on the part of the
Central Government in issuing a notification under Section
25( 1) of the Customs Act in respect of other goods and
contrary to Article 14 of the Constitution oflndia? H
500 SUPREME COURT REPORTS [2016] 4 S.C.R.

A 31. In Re Issue No.1:
The whole thrust of the appellant is that the proposals of the Finance
Minister were duly approved by the Parliament. No doubt, the appellant
has placed before this Court the proposals of the Finance Minister which
discloses the intention of the Government but there is no material placed
B before us to demonstrate that the budget proposals are duly accepted by
the Par! iament. It is an admitted fact that pursuant to the proposals, the
Finance Act was passed by the Parliament wherein for the goods
specified under Tariff Sub-Heading 2208.10, particular tariff was
specified. We are unable to agree with the argument advanced by the
appellant for the reason that he. is unable to make note of the difference
c between a proposal moved before the Parliament and a statutory
. provision enacted by the Parliament, because the process of Taxation
involves various considerations and criteria.
Every legislation is done with the object of public good as said by
Jeremy Bentham. Taxation is an unilateral decision of the Par! iament
D and it is the exercise of the sovereign power. The financial proposals
put forth by the Finance Minister reflects the governmental view for
raising revenue to meet the expenditure for the financial year and it is
the financial policy of the Central Government. The Finance Minster's
speech only highlights the more important proposals of the budget. Those
E are not the enactments by the Parliament. The law as enacted is what
is contained in the Finance Act. After it is legislated upon by the
Parliament and a rate of duty that is prescribed in relation to a particular
Tariff Head that constitutes the authoritative expression of the legislative
will of Parliament. Now in the present facts of the case, as per the
finance bill, the legislative will of the Parliament is that for the commodities
F falling under Tariff Head 2208.10, the tariff is Rs.300/- per litre or 400%
whichever is higher. Even assuming that the amount of tax is excessive,
in the matters of taxation laws, the Court permits greater latitude to the
discretion of the legislature and it is not amenable to judicial review.
In view of the foregoing discussion, we are unable to concur with
G the submission of the appellant that the budget proposals are duly passed
and approved by the Parliament and moreover, ifthe appellant is aggrieved
by the particular tariff prescribed under the Finance Act and the same is
contrary to the approved budget proposals, he ought to have questioned
the same if permissible. Hence, this issue is answered against the
H appellant.
AMIN MERCHANT v. CHAIRMAN, CENTRAL BOARD OF 501
EXCISE & REVENUE [N. V. RAMANA, J.]

32. In Re : Issue No.2: A
It is the case of the appellant that in respect of other categories of
the budgetary proposals, several notifications were issued by the 2"d
respondent altering the Tariff rates, but whereas in his case, the 2"d
respondent refused to issue such a notification and it is nothing but mala
fide and corrupt practice on the part of the respondents. According to B
him, the budget proposals passed and approved· by the Parliament are
paramount and the Executive or Central Government cannot prescribe
Tariff rates contrary to the budget proposals and he finds fault with the
way the 2nd respondent officials are functioning.
A thorough look at the relevant provisions reveals that the source c
of power to issue notification by the Central Government relates to
Section 25 of the Customs Act, 1962, which reads as under:
"Power to grant exemption from duty.
(1) If the Central Government is satisfied that it is necessary in
the public interest so to do, it may, by notification in the Official D
Gazette; exempt generally either absolutely or subject to such
conditions (to be fulfilled before or after clearance) as may be
specified in the notification goods of any specified description from
the whole or any part of duty of customs leviable thereon.
(2) If the Central Government is satisfied that it is necessary in E
the public interest so to do, it may, by special order in each case
exempt from the payment of duty, under Circumstances of an
exceptional nature to be stated in such order, any goods on which
duty is leviable."
Section 25 of the Act delegates power to the Central Government F
i.e. the executive branch to grant exemption generally from duty
whenever it finds that it is necessary to do so in the larger public
interest either absolutely or subject to such conditions as may be
specified in the notification or by a speciai order in each case
under exceptional circumstances.
G
As per Section 159 of the Act, any notification issued under Section
25 shall be placed before the Parliament and the Parliament may
amend or reject the same. This clearly demonstrates that the
ultimate law making power is vested with the Legislature. Hence,
the allegation of the appellant that the notifications are issued basing
H

...
502 SUPREME COURT REPORTS [2016] 4 S.C.R.

A on the whims and fancies of the 2"d respondent is misconceived.
Whereas, notifications are issued generally in the larger public
interest, the Legislature has given the power to exempt duty to
the 2"d respondent subject to the amending power.
In these circumstances, it is not appropriate on our part to issue
B any orders directing them to issue a notification under Section 25 (2) of
the Act except on the grounds of discrimination. In the matter of taxation,
the Court gives a greater latitude to the legislative discretion. Accordingly,
the issue is answered.
33. In Re : Issue No.3:
c In regard to this issue 'Whether the compound alcoholic
preparations of a kind used for manufacturing of beverages fall under
the category of alcoholic beverages', the appeliant has relied upon a
judgment of the Bombay High Court which was confirmed by this Court
and the learned senior counsel for respondents made several contra
D submissions relying on some judgments. According to us, it is not for us
to do this exercise. It is always open to the parties to settle the dispute
before the appropriate forum if they choose to do so. The issue is
accordingly answered.
34. In Re : Issue No.4:
E According to the appellant, the Central Government has issued
notifications under Section 25( I) and he is also entitled to such a
notification in respect of the commodities falling ui1der the category
2208.10. When the appellant alleges discriminatory action on the part of
the respondents, he has to establish that there is no rational basis for
making classification between the goods which are notified and the goods
F
of the appellant which are not notified. It is also a firmly established
principle that the legislature understands and appreciates the needs of
its people. A'Taxing Statute can be held to contravene Article 14 of the
Constitution if it purports to impose certain duty on the same class of
peopfo differently and leads to obvious inequality. Such a material is not
G placed before us to come to a just conclusion that the action of the
respondents is discriminative. Hence, the same is held against the
appellant.
35. As far as the interest aspect is concerned, when the appellant
is not entitled forthe relief, there is no need for us to express any opinion
H on the interest aspect.
AMIN MERCHANT v. CHAIRMAN, CENTRAL BOARD OF 503
EXCISE & REVENUE [N. V. RAMANA, J.]

36. Before we conclude, we would like to record our appreciation A
for the strenuous efforts put forth by the appellant and the kind of efforts
he put in to collect the data. We feel that it is not out of place to mention
that the appellant has presented the case like a seasoned professional
with utmost skill and knowledge.
37. In view of the aforesaid elaborate discussion, we reach to an B
irresistible conclusion that the appeals, being devoid of any merit, deserve
to be dismissed and are dismissed accordingly. No costs.
Devika Gujral Appeals dismissed.