1997 (5) TMI 56 - SC - Customs

Letter dated 16th August 1985 not valid as bill of entry under Section 46(5); substitution application rejected to prevent revenue loss

The SC held that a letter dated 16th August, 1985 could not be treated as a valid bill of entry under Section 46(5) for substitution purposes, as the bill ... Whether letter dated 16th August, 1985 should have been treated as sufficient by the Customs Officer to pass suitable order under sub-section (5) of Section 46 allowing substitution of the bill of entry for home consumption for the bill of entry for warehousing? Held that:- If a statutory form is prescribed for presentation of a bill of entry, then the bill of entry has to be in the prescribed form. Section 46(5) contemplates substitution of one bill of entry by another. The second bill of entry must also be prepared and lodged with the proper officer in the prescribed form. It cannot be said that the first application was in the prescribed form. No order could be passed upon it by the proper officer by treating it as a bill of entry for warehousing. The second application of 26th August, 1985, accompanied by a bill of entry for warehousing, reached the Assistant Collector on 28th August, 1985 late in the day. We are of the view that the Tribunal has come to a correct decision in holding that the application could not possibly have been dealt with and disposed of then and there as soon as it was received. It was known on that date that the rates of tax were reduced. To allow substitution of the bill of entry as prayed by the appellant would have caused loss of revenue. This application was rightly rejected. Issues:1. Application for changing Bill of Entry from home consumption to warehousing.2. Failure to act on the application by the Customs Officer.3. Interpretation of Customs Act provisions regarding bill of entry.4. Contention of the appellant regarding lack of prescribed form for application.5. Tribunal's decision on the application for substitution of bill of entry.6. Impact of reduced tax rates on the decision.Analysis:1. The appellant lodged a Bill of Entry for home consumption but later requested to change it to a Bill of Entry for warehousing due to financial constraints. The Customs Officer did not act on the application promptly, leading to subsequent letters from the appellant seeking permission for the change.2. The appellant contended that the lack of action by the Assistant Collector of Customs on the initial application should not penalize the appellant. The second application, made on 26th August, 1985, was also not promptly disposed of, leading to a delay in decision-making.3. The Customs Act provisions, specifically Section 15 and Section 46, were crucial in determining the rate of duty applicable to the imported goods. Section 46 outlines the requirements for presenting a bill of entry for home consumption or warehousing in the prescribed form, emphasizing the need for compliance with the statutory provisions.4. The appellant argued that no prescribed form was provided for the application to change the Bill of Entry, and the lack of formalities should not hinder the process. However, the court emphasized the importance of compliance with the prescribed form for submission of entries under the Customs Act.5. The Tribunal correctly rejected the application for substitution of the bill of entry due to the late receipt of the second application and the subsequent knowledge of reduced tax rates, which would have caused revenue loss if the substitution was allowed.6. The judgment highlighted the significance of following the statutory requirements for presenting bill of entries under the Customs Act and upheld the decision to dismiss the appeal, considering the impact of reduced tax rates on the appellant's request for substitution of the bill of entry.