Customs, Excise and Gold Tribunal - Mumbai
Jai Corpn. Ltd. vs Commissioner Of Central Excise on 15 July, 1998
Equivalent citations: 1999(105)ELT747(TRI-MUMBAI)
ORDER Gowri Shankar, Member (T)
1. The appellant imported three consignment of steel coils in Mumbai. It filed bills of entry for warehousing, these goods and (sic) sought for and was given permission to have the goods warehoused in a bonded place a Nanded. The appellant subsequently cleared the goods from the bonded warehouse on payment of duty.
2. Notice was issued by the Additional Commissioner of Customs, Aurangabad to appellant, alleging that since the goods stayed in the bonded warehouse beyond thirty days, interest under Sub-section (3) of Section 61 of the Customs Act, was payable for the period for which the goods remained in the warehouse exceeding seven days from the return of the bill of entry for warehousing. The Additional Commissioner of Aurangabad after hearing the importer found that the Customs House at Mumbai had permitted the importer to keep the goods in a bonded warehouse till 29th March, 1995, and that the interest was to be charged according to the order of Assistant Commissioner of Customs, Mumbai, from 30th March, 1995. He said that the Customs authorities at Aurangabad had no jurisdiction to ignore this order and demand interest for a period prior to 29th March, 1995.
3. The Department went in appeal against this order. Collector (Appeals) set aside the order of the Assistant Commissioner and remanded the matter to him to consider the demand for interest in the light of provisions of Section 47 and 61 of the Act as they stood at the relevant time. In the course of the order he observed as follows :
"I find that the Additional Commissioner had simply gone by endorsement regarding warehousing period made by Customs House. There was some error in this endorsement where the warehousing period allowed was more than one permitted under the law. However, endorsing the warehousing period does not amount to assessment which includes determination of rate of duty and value. Even otherwise the jurisdictional officer at Nanded was competent to revise the assessment in accordance with the law at the time of exbonding".
4. It is the appellant's contention that the proper officer at the port of importation having passed an order permitted warehousing for a period of a year and indicating that interest is payable after the expiry of that period. It was not open to the authorities at Aurangabad to ignore this order and to take a different view. The order passed under Section 61 had attained finality. It is further contended that the Collector (Appeals) had exceeded the scope of the application under Section 129D filed before him.
5. The Departmental Representative contends that it could not be said that the order under Section 61 of the Act attained finality. Rate of duty applicable for goods to be removed from a bonded warehouse from the date of such removal provided under Section 15. Therefore, the authorities at Aurangabad were justified in applying the provisions of law. He disputes the contention of the appellant that the notice, and the appeal before the Commissioner (Appeals) by the Department did not include in its scope the question of the order passed under Section 61 of the Act by Mumbai Custom House.
6. The Commissioner (Appeals) is no doubt partially right in saying that the jurisdictional officer at Aurangabad is competent to revise the order of assessment in accordance with law. Section 15 prescribes that the rate of duty and valuation applicable to goods cleared from a warehouse shall be rates and the valuation on the date on which such goods are actually removed from the warehouse. This dispute in this case, however, does not refer to either of these two. There is no tariff value for the goods, and the officers at Aurangabad did not seek to apply a rate of duty different that the one applied by Mumbai Custom House. The question is the period from which goods may remain in a bonded warehouse without payment of interest and whether, when the goods were warehoused, part of the duty was required to be deposited. Neither of these question relates to assessment. Section 17 of the Act contains the provisions relating to assessment of duty on imported and export goods. It provides for examination and testing by the proper officer and therefore assessment of. duty, if any, leviable. Assessment therefore, involves determination of those questions leading to determination of rate of duty applicable. Payment of interest on this duty, deposit of part of this duty obviously will take place after such assessment is arrived at. They are not part of the processes leading to such assessment. The interest on the amount of duty payable is determined. The Commissioner (Appeals) was, therefore, in error in holding that calculation of warehousing period and amount of interest payable are part of assessment and could be revised by the officers at Aurangabad.
7. Section 60 of the Act provides that when the provisions of Section 59 of the Act have been complied with, proper officer may make an order permitting the deposit of the goods in a warehouse. The order made by the Assistant Commissioner at Mumbai Customs House was an order under this Section. The order passed under this section, therefore, would have to set aside by appropriate process of law before it could be substituted by any other order. We do not consider it necessary to go into the question of whether such an order requires to be set aside by resorting to the appellant process. The notice issued to the appellant did not seek to set aside this order. It proceeded on the assumption that the order was incorrect and that the warehousing period was something other than that provided in this order. Whatever the methodology that might be required for setting aside that order, had not been resorted to either in the notice or independent of it. The officers at Nanded could not simply ignore that order to proceed, what according to them was the right position in law. To that extent, therefore, the notice issued contravened in the law. The appeal to the Commissioner (Appeals) under Section 35E(2) again proceeded on the same assumption as the notice, alleging that the Additional Commissioner could have confirmed the demand therefore, that chose to ignore the order passed by the Assistant Commissioner, Mumbai Custom House and for that reason it cannot be upheld.
8. In this background, we have to hold that the order of the Commissioner (Appeals) cannot be sustained and set it aside and allow the appeal.