Case: Shroff &amp; Co., Etc Vs. Municipal Corporation Of Greater Bombay Andanother, Etc

See in this connection the observations of this Court in R. C. Jall v. Union of India, where at page 451 of the report this Court reiterated that the method of collection does not affect the essence of the duty, but only relates to the machinery of collection for administrative convenience. 32. In McDowell v. CTO at pages 813-15 (SCC pp. 246-48) the position in relation to excise duty has been clearly stated. In the case of Chatturam Horilram Ltd. v. CIT the concept of imposition of duty has been explained. There are three stages in the imposition of tax. It was observed as follows: "As has been pointed out by the Federal Court in Chatturam v. CIT quoting from the judgment of Lord Dunedin in Whitney v. Commissioners of Inland Revenue "there are three stages in the imposition of a tax. There is the declaration of liability that is the part of the statute which determines what persons in respect of what property are liable. Next, there is the assessment. Liability does not depend on assessment. That, ex hypothesi, has already been fixed. But assessment particularises the exact sum which a person liable has to pay. Lastly, come the methods of recovery if the person taxed does not voluntarily pay." 33. An argument was advanced on the basis of certain observations of this Court in Central India Spinning and Weaving and Manufacturing Company Ltd. v. Municipal Committee, Wardha (at 1114 of the reports) that there is no mixing up of goods which are in bond till these are removed from bond. The observations were made in the context of the facts of that case. There, the facts were that certain cotton bales were being transported in transit through Wardha. The municipality wanted to impose terminal tax. In that context it was observed that there was no mixing up of the goods in the mass of the property in the area. This case was not fully approved in Gramophone Company of India Ltd. v. Birendra Bahadur Pandey where at page 691 this Court observed as follows : (SCC pp. 554-55, para 30) "We are afraid the case (i. e., the Empress Mills case) is really not of any guidance to us since in the context of a terminal tax the words imported and exported could be construed in no other manner than was done by the court. We must however say that the original package doctrine as enunciated by Chief Justice Marshall on which reliance was placed was expressly disapproved first by the Federal Court in the Province of Madras v. Buddu Paidanna and again by the Supreme Court in State of Bombay v. F. N. Balsara. Apparently these decisions were not brought to the notice of the court which decided the case of Central India Spinning and Weaving and Manufacturing Co. Ltd. v. Municipal Committee, Wardha." 34. It is clear from the observation made in Wilson v. Chamber and Company Proprietary Ltd. that these observations were made in the context of goods in transit or goods arriving by way of wrecks. All the judgements in the above cases accept the position that if goods are imported into Australia for the purpose of the goods becoming part of the commerce of the country, these could be said to be imported. This is clear from the observations of Chief Justice Knox at page 136 of the report as well as the argument of Mr. Mitchell, counsel at pages 132 and 133 of the report. Therefore, the purpose of the import is decisive. If these are brought for the purpose of commerce or trade, these are imported. Justice Isaacs at page 139 highlighted the expression "imported goods", in Section 68 as meaning goods which, in fact, are brought from abroad into Australian territory, and in respect of which the carriage is ended or its continuity in some way in fact broken. The observations of Justice Starke set out at page 150 of the report reaffirm this position. 35. Countervailing duty also does form part of the incidental charges. Countervailing duty is clearly contained in Rule 2 (7) (a) of the Octroi Rules. The rule prevalent prior to June 28, 1983 was in the following terms Value of the articles where the octroi is charged ad valorem shall mean the value of the articles made up of the cost price of the articles as ascertained from original invoice plus shipping dues, insurance, customs duties, excise duties, sales tax, vend fees, freight charges, carrier charges and all other incidental charges excepting octroi incurred by the importer, till the articles are removed from the place of import." 36. This rule used the words "excise duties" as also the words "all other incidental charges". Section 105 of the Bombay Prohibition Act 1949 itself talks of excise duties so as to include both excise duty as well as countervailing duty. Therefore, the normal connotation of the words "excise duties" would take in countervailing duty also. Apart from that charges include taxes. In this connection reference may be made to the observations of this Court in D. G. Gouse & Co. v. State of Kerala. It was observed as follows : (SCC p. 420, para 5)The word tax in its widest sense includes all money raised by taxation. It therefore includes taxes levied by the Central and the State legislatures, and also those known as "rates", or other charges, levied by local authorities under statutory powers. 37. The expression "incidental" has also been judicially interpreted. The expression "incidental" means necessary in certain contexts which does not mean a matter of casual nature only. See State of Orissa v. Chakobhai Ghelabhai & Co. 38. In that view of the matter we are of the opinion that countervailing duty was an incident of importation and, as such, it was includible even prior to June 28, 1983 as an octroi. 39. In that view of the matter, in our opinion, the Division Bench was right in the view it took and

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]36. This rule used the words "excise duties" as also the words "all other incidental charges". Section 105 of the Bombay Prohibition Act 1949 itself talks of excise duties so as to include both excise duty as well as countervailing duty. Therefore, the normal connotation of the words "excise duties" would take in countervailing duty also. Apart from that charges include taxes. In this connection reference may be made to the observations of this Court in D. G. Gouse & Co. v. State of Kerala. It was observed as follows : (SCC p. 420, para 5)The word tax in its widest sense includes all money raised by taxation. It therefore includes taxes levied by the Central and the State legislatures, and also those known as "rates", or other charges, levied by local authorities under statutoryThe expression "incidental" has also been judicially interpreted. The expression "incidental" means necessary in certain contexts which does not mean a matter of casual nature only. See State of Orissa v. Chakobhai Ghelabhai &In that view of the matter we are of the opinion that countervailing duty was an incident of importation and, as such, it was includible even prior to June 28, 1983 as anIn that view of the matter, in our opinion, the Division Bench was right in the view it took