Customs duty attaches on unloading, and exemption changes are not barred by promissory estoppel without a clear promise.

Customs duty is treated as chargeable when imported goods are unloaded and brought into the customs process, not merely when the vessel enters territorial waters, so the exemption notification in force on that date governs the levy. The note also explains that promissory estoppel does not bar withdrawal or modification of an exemption notification issued under Section 25 unless there is a clear, unequivocal promise to keep the concession alive for a fixed period; absent such a promise, the Government may rescind or alter the exemption in public interest.

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Issues: (i) Whether customs duty was chargeable on the date the vessel first entered territorial waters or on the date the goods were unloaded and the bill of entry was presented; (ii) Whether the withdrawal or modification of the earlier exemption notification could be challenged on the doctrine of promissory estoppel.

Issue (i): Whether customs duty was chargeable on the date the vessel first entered territorial waters or on the date the goods were unloaded and the bill of entry was presented.

Analysis: The statutory scheme of the Customs Act required the meaning of "India" in Section 12 to be read in context. The inclusive definition in Section 2(27) did not fit the charging provision, because the Act elsewhere used "India" in the territorial or political sense and because the scheme for import and export clearance, together with Section 13, showed that duty attached when imported goods were unloaded and brought within the customs process for home consumption. The Court preferred the view that importation for the purpose of chargeability occurred when the goods were unloaded at the port and became part of the mass of goods in India, not merely when the vessel entered territorial waters.

Conclusion: The goods were chargeable to customs duty on the date of unloading and the applicable notification in force on that date governed the levy; this issue was decided against the appellant.

Issue (ii): Whether the withdrawal or modification of the earlier exemption notification could be challenged on the doctrine of promissory estoppel.

Analysis: Promissory estoppel required a clear and unequivocal promise intended to be acted upon. The earlier exemption notification contained no assurance that the concession would continue for any fixed period, and an exemption issued under Section 25 was inherently capable of being rescinded or modified in public interest. In the absence of any promise to keep the exemption alive, and the Government acting within its statutory power, the doctrine could not prevent withdrawal or alteration of the exemption.

Conclusion: The plea of promissory estoppel failed and the notification could not be challenged on that ground; this issue was decided against the appellant.

Final Conclusion: The appeal failed on both substantive questions, the levy of customs duty was upheld, and the challenge to the revised exemption notification was rejected.

Ratio Decidendi: For customs duty under Section 12 of the Customs Act, 1962, importation is complete when the goods are unloaded and brought into the customs process in India, and an exemption notification under Section 25 may be rescinded or modified unless it contains a clear promise binding the Government for a specified duration.

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