2023 (11) TMI 773 - HC - Customs

Assessing authority has jurisdiction under Section 28 to assess IGST exemption claims on imported goods

Kerala HC dismissed a writ petition challenging the assessing authority's jurisdiction under Section 28 of Customs Act to assess IGST on imported wet ... Assessment - determination of dutiability and amount of duty, tax, cess or any other sum payable - assessment under Section 28 of the Customs Act - claim of exemption from IGST under notification - power to assess taxes, duties and cesses on imported goods Assessment - assessment under Section 28 of the Customs Act - claim of exemption from IGST under notification - Validity of the impugned assessment order issued under Section 28 of the Customs Act in respect of alleged short levy of IGST on imported dates - HELD THAT: - The Court examined the definition of assessment in sub section (2) of Section 2 of the Customs Act which encompasses determination of the dutiability of goods and the amount of duty, tax, cess or any other sum payable under this Act, the Customs Tariff Act or any other law, including exemption or concession consequent upon notifications. Although duty is defined in sub section (15) of Section 2 as customs duty, Section 28 empowers the assessing authority to assess and recover duties not levied or short levied. Read together, the statutory scheme authorises the assessing authority to determine and recover not only customs duty but also taxes or cesses payable on imported goods where such liabilities arise from tariff classification, valuation or claimed exemptions under notifications. The petitioner had claimed exemption from IGST under the relevant notification; therefore the assessing authority was competent under Section 28 (in light of the broader statutory definition of assessment) to examine and determine the correctness of that claim and to confirm demand for short levied IGST and interest where applicable. [Paras 7, 8, 9, 10] The assessment order under Section 28 confirming demand of IGST and interest is not without jurisdiction and the writ petition is dismissed; petitioner retains remedy by way of appeal and time spent in the writ petition will be considered for condonation of delay in filing the appeal. Final Conclusion: Writ petition dismissed: the Customs assessing authority was competent to determine and recover the alleged short levy of IGST arising from a claimed exemption under the notification; the petitioner may prefer an appeal and the period spent in the writ petition will be taken into account for condonation of delay. Issues involved:The judgment involves the classification of imported goods, assessment of duty, jurisdiction of the assessing authority, and the application of IGST exemption.Classification of Imported Goods:The petitioner imported items declared as 'Wet Dates' and classified them under CTH 0804 1020. A post-clearance audit revealed that the IGST exemption claimed was not applicable to 'wet dates' but to 'fresh dates'. The petitioner was issued a show cause notice for short levied duty, but failed to respond adequately despite multiple opportunities.Jurisdiction of Assessing Authority:The petitioner argued that the assessing authority under the Customs Act did not have the power to assess IGST, as it falls under the jurisdiction of the IGST Act. The petitioner contended that the impugned order was void ab initio due to being passed by an incompetent authority.Application of IGST Exemption:The petitioner claimed exemption from IGST under a specific notification. The assessing authority, however, found that the exemption was not applicable to the imported goods. The court determined that the competent authority was empowered to assess the claim of exemption from IGST under Section 28 of the Act.Conclusion:The court dismissed the writ petition, finding it to be misconceived. It stated that the assessing authority had the jurisdiction to assess duties applicable to imported goods, including IGST. The petitioner was advised to pursue the remedy of appeal, with the time spent on the writ petition considered for any delay in filing the appeal.