1999 (1) TMI 294 - AT - Customs

Appeals Denied Due to Time-Barred Interest Demands

The Tribunal rejected the appeals as the demands for interest were deemed time-barred under Section 28 of the Customs Act. The Commissioner (Appeals) ... Demand for interest on warehoused goods - Limitation Issues:- Defects in revenue appeals filed against common order by Commissioner (Appeals)- Enforcement of demands raised pertaining to interest on bonds- Application of law of estoppel to the department for assurances given in Public Notice No. 211/91- Interpretation of Section 28 of the Customs Act regarding recovery of interest on warehouse goods- Consideration of reasonable period of limitation for recovery of demand/recovery of interest under Customs ActAnalysis:1. The judgment addresses the issue of defects in revenue appeals filed against a common order by the Commissioner (Appeals). The Registry pointed out these defects in appeals filed in 1996, and despite a fresh memo issued to rectify them, the defects remained unattended. The cases were listed to allow the appellant/revenue to address these defects as directed by the Registry.2. The next issue revolves around the enforcement of demands raised concerning interest on bonds. The Commissioner determined that the demands for interest based on the bonds were time-barred as they were raised after the normal time limit of six months. The issue of whether the demands could be enforced was examined in light of the time limitation.3. The judgment delves into the application of the law of estoppel to the department based on assurances given in Public Notice No. 211/91. The Commissioner held that the department was estopped from going back on the public notice, regardless of whether the demands were still enforceable under the bond terms. The Commissioner relied on relevant case law to support this view.4. A crucial aspect of the judgment involves the interpretation of Section 28 of the Customs Act regarding the recovery of interest on warehouse goods. The Tribunal considered the absence of a prescribed period of limitation under Section 61(3) and emphasized the need to read a reasonable period of limitation into the section. The judgment referenced previous decisions and Supreme Court rulings to support the interpretation.5. Lastly, the judgment discusses the determination of a reasonable period of limitation for the recovery of demand/recovery of interest under the Customs Act. Drawing parallels with the Central Excises and Salt Act, the Tribunal held that a similar logic should apply in the absence of a prescribed period of limitation. The judgment upheld the lower authority's decision that demands for interest beyond six months from clearance of goods were time-barred, leading to the dismissal of the revenue's appeals.6. Ultimately, the Tribunal rejected the appeals based on the sustainable view taken by the Commissioner (Appeals) that the demands were time-barred under Section 28 of the Customs Act. The stay applications were disposed of as the main appeals were dismissed on the grounds of time limitation and enforcement of demands.