Customs, Excise and Gold Tribunal - Mumbai
Hameo Mining & Smelting Co. Ltd. vs Commission Of Central Excise & Customs, ... on 20 February, 2001
ORDER
Gowri Shankar, Member (Technical)
1. The appellant imported four consignments of aluminium scrap which was used in relation to manufacture of its finished product. It took additional duty of customs paid on the scrap as modvat credit on 28.9.95. At the relevant time, the second proviso under sub-rule (2) of rule 57G provided the credit should not be taken beyond six months after the issue of the duty paying documents specified in the first proviso under that sub-rule, among which was included a bill of entry.
2. The additional duty was paid on the four consignments in question on 24.3.95. The credit was taken six months after the payment of duty. The department issued notice proposing to disallow the credit taken alleging that the second proviso had been contravened. The Asst. Commissioner whose order has been confirmed by the Commissioner (Appeals) confirmed the proposal in the notice. Hence this appeal.
3. The appellant is absent and unrepresented despite notice. We have read the memorandum of appeal and heard the department representative.
4. The primary contention in the appeal is that the goods were not cleared from the customs on dates between 31.3.95 and 3.4.95 and the limit of six months should be reckoned from this date. By doing so, there is no contravention of the rules and credit is available. The department representative reiterates the reasoning for the denial of the credit i.e. the date of payment.
5. The first proviso under Rule 57G(1) reads as follows:
6. The "date of issue" for invoice under rule 52A and a certificate issued by appraiser of custom in the foreign post office is clear enough it cannot be disputed that, except possibly on rare occasions the Central Excise invoice is issued shortly prior to the clearance of the goods. No goods can be cleared from the factory of their manufacture unless duty is paid on them, and the invoice is issued. The rate of duty that would apply to the goods is that prevailing on the date of their removal. The cumulatively they result in duty being paid on the goods shortly before they are intended to the removed. Further, no manufacturer would debit duty considerably prior to clearance of the goods. Generally, a dealer, too, would issue an invoice shortly before he despatches the goods, in accordance with normal commercial practice.
7. There is no "date of issue" of a bill of entry. The bill of entry referred to in the sub-rule is filed by an importer either for clearing the goods for home consumption either directly after importation or from a bonded warehouse. In this case, we are concerned with bills of entry filed for clearance for home consumption directly after import. The duty is paid on goods in such cases on one of two dates. In cases Where the assessment is completed without there being any need to examine the goods, the importer pays with duty after completion of assessment. The goods may thereafter the examined, and, if no discrepancy is found, permitted to be cleared form customs by the preventive officer of customs posted in the docks. If, on examination the goods are found to be different from what they were declared to be, they may be subjected to reassessment, requiring a further payment of duty, or subjected to adjudication, involving confiscation or fine. In other situation, the goods are first examined and thereafter the assessment completed. "The manufacturer pays the duty due on them thereafter, and it is the cashier who collects the duty who permits them to be cleared out of customs.
8. In the second the third types of cases, there will be an interval of time between the payment of the duty and the clearance of the goods. The delay could be considerable. The processes of reassessment and adjudication both take some time. Sometime the goods themselves may not be easily found in the docks,and only be traced after an extended search.
9. In all the types of cases that we have described above, the goods would be available to the importer only after the proper officer of customs makes the order for their clearance. He is able to physically deal with them only after this date. He has no control whatever over the processes in the custom house relating to assessment of the goods. There is also no date of issue for a bill of entry, unlike an invoice issued under the Central Excise rules. The date of issue of a bill of entry, therefore, is to be nationally reckoned.
10. Having regard to the facts that we have discussed, it would be reasonable to say that the "date of issue" in the case of goods imported and cleared thereafter for home consumption cannot be earlier than the date on which the importer can reasonably expect that the goods come into his hands soon. That would be the date on which the good are passed out of customs charge. By applying that criterion the credit has been taken within six months from the date of issue.
11. We therefore allow this appeal, set aside the impugned order. Consequential relief according to law.