Additional customs duty is measured at warehouse clearance, and imported goods remain assessable despite factory-based tariff wording.

Additional duty under section 3(1) of the Customs Tariff Act, 1975 was treated as customs duty for levy and quantification, so the relevant point for assessment was the date of clearance from warehousing rather than the date the goods entered territorial waters. On that basis, the refund claim failed. The Tribunal also held that imported goods did not escape additional duty merely because Tariff Item 68 then referred to goods manufactured in a factory; the excise duty on a like Indian article served only as the measure of duty, and the imported article needed only to correspond to the relevant class or description for tariff purposes. The rejection of refund was upheld.

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Issues: (i) Whether additional duty on imported goods was to be determined with reference to the date the goods entered the territorial waters of India or the date they were cleared from the warehouse. (ii) Whether imported goods could escape additional duty on the ground that Tariff Item 68, as it then stood, referred to goods manufactured in a factory.

Issue (i): Whether additional duty on imported goods was to be determined with reference to the date the goods entered the territorial waters of India or the date they were cleared from the warehouse.

Analysis: The Tribunal treated the nature of additional duty under section 3(1) of the Customs Tariff Act, 1975 as partaking of customs duty. In the light of the Supreme Court ruling relied upon, the exemption position at the time of import did not by itself govern liability where the goods were not wholly exempt from basic customs duty. The relevant point for quantification of duty was the stage of clearance from warehousing, not merely the date of entry into territorial waters.

Conclusion: The duty liability had to be worked out with reference to the date of clearance from the warehouse, and the refund claim failed on this ground.

Issue (ii): Whether imported goods could escape additional duty on the ground that Tariff Item 68, as it then stood, referred to goods manufactured in a factory.

Analysis: The Tribunal held that, for the purpose of section 3(1) of the Customs Tariff Act, 1975, the excise duty on a like article produced or manufactured in India operates only as the measure of duty. The imported article need not itself be capable of being manufactured in India. Duty is determined on the class or description of the article imported, and the goods in question could be treated as falling within the corresponding tariff item.

Conclusion: The contention based on the factory-based wording of Tariff Item 68 was rejected and did not entitle the appellants to refund.

Final Conclusion: The Tribunal found no infirmity in the rejection of the refund claims and upheld the orders below.

Ratio Decidendi: Additional duty under section 3(1) of the Customs Tariff Act, 1975 is to be treated as customs duty for the purpose of levy and quantification, and the imported article need only correspond to the relevant class or description for tariff classification and duty assessment.

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