2008 (6) TMI 142 - AT - Customs

Tribunal Allows Appeal on Duty Rate Interpretation, Upholds Unjust Enrichment Principle

NM NAGPAL (PVT.) LTD. Versus COMMISSIONER OF CUS., KANDLA (GUJARAT)

The Tribunal set aside the impugned order and allowed the appeal, subject to the principle of unjust enrichment. The decision was based on the ... Contention of appellant is that, goods were assessed to appropriate duty on filing ex-bond bills entry prior to introduction of SAD and goods were ordered to be out of charge prior to the introduction of SAD, therefore, they are not liable to pay the Special Additional Duty of Customs which was introduced thereafter - only due to problem in transportation, goods actually transported from warehouse after introduction of SAD – in such cases, SAD is not imposable Issues:1. Challenge against the imposition of Special Additional Duty of Customs (SAD) on goods cleared before its introduction.2. Interpretation of the applicable duty rate for goods cleared from a warehouse.Analysis:1. The appellant challenged the imposition of SAD on goods cleared before its introduction. The appellant imported styrene Monomer and filed a bill of entry on 24-4-98. The goods were warehoused, and ex-bond bills of entry were filed for clearance between 25 to 29-5-98. Due to a transportation problem, the goods were actually transported from the warehouse on 6-6-98, after the introduction of SAD on 2-6-98. The revenue directed the appellant to deposit the SAD before clearance, which was done. The Tribunal remanded the matter to the Adjudicating Authority for fresh decision. The appellant relied on a Tribunal decision in another case. The Commissioner (Appeals) noted that the Tribunal's decision was appealed by the revenue and was pending in the Supreme Court. The appellant contended that the Supreme Court dismissed the appeal filed by the Revenue in the cited case.2. The appellant argued that since the goods were assessed to appropriate duty before the introduction of SAD and were ordered to be out of charge before the introduction of SAD, they should not be liable to pay the Special Additional Duty introduced thereafter. The Tribunal referred to a Supreme Court decision in another case to settle this issue. The Supreme Court held that the duty payable for goods cleared for home consumption under Section 46 is as on the date the goods were cleared. In the present case, the full duty was paid, and the Customs Officer permitted clearance. The goods were not considered warehoused goods but were allowed to be stored in a private warehouse. The Supreme Court clarified that goods cleared from the warehouse have to be treated as cleared for home consumption when duty on the warehoused goods is paid and an out-of-charge order for home consumption is made.In conclusion, the Tribunal set aside the impugned order and allowed the appeal, subject to the principle of unjust enrichment. The decision was based on the interpretation of the duty rate applicable to goods cleared from a warehouse, as clarified by the Supreme Court in a related case.