TaxTMI 
TaxTMI 
2014 (5) TMI 163
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....ther penalty of Rs. 5 crore has been imposed on M/s. JNPT under Section 112(a) and 112 (b) of the Customs Act, 1962. Aggrieved of the same, the appellant is before us. 3. The facts relating to the case as follows: 3.1 M/s. Nhava Sheva Port Trust (NSPT) now known as 'Jawaharlal Nehru Port Trust' (JNPT) awarded a contract (termed as contract III) dated 15/12/1986 to M/s. Samsung Co. Ltd., South Korea for setting up the NSPT Port Project. In the said contract, NSPT has been termed as the 'Employer' and M/s. Samsung Co. Ltd. as the 'Contractor'. 3.2 Pursuant to the said contract, M/s. Samsung Co. Ltd. imported Container Handling Equipment and spares for NSPT Project between 1988 and 1990. However, before clearance of the goods, it sought to avail itself of the project import benefit under the Projects Imports Regulations, 1986. Accordingly, it applied for registration of the Contract-III to the then Assistant Collector of Customs Project Cell, New Custom House, Bombay vide its letter dated 12/09/1988. 3.3 The Assistant Coll....
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....d Act. The Commissioner has also imposed a penalty of Rs. 5 Crores on NSPT under Section 112(a)(ii) and Section 112(b) of the said Act. The Commissioner also imposed a penalty of Rs. 5 Crores on Samsung Co. Ltd. under Section 112(a)(ii) of the said Act. Aggrieved of the same, M/s. JNPT is before us. 3.7. Revenue is also in appeal against the said order for the reason that though the adjudicating authority confirmed the duty demand, he failed to confirm the demand towards interest holding that interest cannot be demanded for the period prior to 13/07/2006 inasmuch as there were no legal provision for recovery of interest in the case of provisional assessment prior to the said date. 4. The learned counsel for the appellant made the following submissions: 4.1 In terms of the Project Import Regulations 1986, as it stood at the relevant time, there was no requirement of a recommendatory letter/certificate from the sponsoring authority or from the Director General of Technical Development. 4.2 The goods required for the project are cover....
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....at the impugned demand is not sustainable in law and therefore, the same deserves to be set aside. 5. The learned special Consultant appearing for the Revenue, on the other hand, contends that as per the public notice issued by the Commissioner of Customs, Mumbai vide Bombay Custom House Public Notice No. 2/88 dated 14/03/1988, for registration of contracts under Project Import Regulations, recommendatory letter for duty concession from the concerned sponsoring authority as provided for in para 288 of the ITC Handbook was required. The appellant did not produce such a recommendation. In the correspondence exchanged between the department and M/s. Samsung Co. Ltd. and M/s. JNPT, M/s. Samsung Co. Ltd. vide letter dated 07/10/1988 had informed the department that they would be producing the said certificate through JNPT from the concerned Ministry at the earliest and also that the benefit of concession would be passed on to M/s. JNPT. In the said letter, they had further confirmed that customs duty would be paid directly by M/s. JNPT on all the equipment and spares imported under the contract. This position was reiterated by M/s. JNPT vide letter dated 15/10/1988 sent to M/s. Samsu....
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....rder. 6. We have carefully considered the submissions made by both the sides. 6.1 Regulation 5 of the Project Import Regulations 1986, stipulates the documents required to be submitted for registration of the contract and the said provision reads as follows:- "The application shall be accompanied by the original deed of contract together with a true copy thereof, the import trade control licence, wherever required, specifically describing the articles licensed to be imported or an approved list of items from the Directorate General of Technical Development or the concerned sponsoring authority, in the case of imports covered by Open General Licence or imports made by Central Government, any State Government, statutory Corporation, public body or Government undertaking run as a joint stock company." 6.2 Subsequently, this condition was amended w.e.f. 10/03/1992 and the revised provisions read as follows: "4) The application shall be accompanied by the original deed of contract together with a true copy thereof, the import trade control licence, wherever required, and an approve....
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....s required in addition to the licence. However, this condition was in existence only in the policy provisions relating to 1985-88 and the said condition was deleted when the policy provisions relating to 1988-91 came into force w.e.f. 01/04/1988. The period of imports in the present case is after 01/04/1988. Therefore, what should be relevant is the policy prevailing at the time of importation and as per the policy prevailing at the time of importation, there was no requirement of obtaining any recommendation from the sponsoring authority. Thus, both in terms of the Project Import Regulations, as also in terms of the Foreign Trade Policy, there was no requirement of obtaining any recommendation letter from the sponsoring authority and hence this stipulation by the Customs authority on the basis of a public notice issued by them is not sustainable in law. Any requirement with respect to registration has to be in terms of the Project Import Regulations or the Foreign Trade Policy as it stood at the relevant point of time. Further, the Bills of Entries had been filed by M/s. Samsung Co. Ltd in their own name and the customs duty payments have also been made in the name of M/s. Samsung....