TaxTMI 
TaxTMI 
2017 (6) TMI 930
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....ods, broadly, on the following grounds: (i)That the warehousing period had expired. (ii)Demand notice under Section 72(1) of the Customs Act, 1962 (in short, the Act), had been issued. (iii)The application, seeking extension of warehousing period, was submitted only after the expiry of the said period and after issuance of demand notice. (iv)Lastly, the reason proferred for extension of time, did not provide sufficient cause for condoning the delay, in filing the application, for extension of time. 3.Accordingly, the Commissioner declined the request made by the Assessee, for waiver of interest, on the ground that the subject goods were not imported under the EPCG Scheme, in the first instance, and that, the warehousing Bills of Entry were assessed to import rate of duty. 3.1.It was further held by the Commissioner that the CBEC Circular 47/2002, dated 29.07.2002, requiring the Revenue to take a lenient view, would not cover those cases, where the warehousing period had expired. 3.2.The Commissioner also came to the conclusion that the goods in issue were improperly removed from the warehouse under Section 72(1)(v) and therefore, were li....
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.... decision was taken, to warehouse the goods covered by the aforementioned Bills of Entry. 6.3.Accordingly, goods which were subject matter of the 1st and 2nd Bills of Entry, were bonded on 07.02.2012, while, the goods which were covered by the 3rd Bill of Entry were warehoused on 10.04.2012. 7.The record shows that the period for warehousing, which was one year, expired, in respect of the 1st and 2nd Bills of Entries on 06.02.2013, whereas, in respect of the 3rd Bill of Entry, the warehousing period expired on 09.04.2013. 8.The Revenue, immediately after the expiry of warehousing period, in respect of the 1st and 2nd Bills of Entry, that is, on 13.03.2013, served a demand notice on the Assessee under Section 72(1) of the Act. 8.1.By virtue of the said demand notice, the Assessee was called upon to pay, within fifteen (15) days, from the date of its receipt, the duty along with interest, at the rate of 15% per annum, albeit, from the date of expiry of ninety days, commencing from the date of warehousing. 8.2.The Assessee, was put to notice, that it would also have to pay, other charges, that may become due and payable. 9.In response to the said demand, the Assessee....
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.... 09.04.2013, the Revenue, indicated to the Assessee, that, in respect of two Bills of Entries, dated 03.02.2012, i.e., the 1st and 2nd Bills of Entry, the period of warehousing, had expired on 06.02.2013, and, since, there was a delay of 349 days, as calculated, till 20.04.2013, it would be required, to pay interest, in the total sum of Rs. 24,32,179/-. 12.1.In this regard, the Revenue drew the Assessee's attention, to the provisions of Section 61 (2) (ii) of the Act and the CBEC Circular No.10/2006 CUS dated 14.02.2006. 12.2.What is required to be noticed, is that, there was, in fact, no reference to the 3rd Bill of Entry, dated 03.04.2012 and to demand for duty. Pertinently, this communication of the Revenue, confined the demand, only to interest. 12.3.The Assessee, in response to the same, shot off a reply dated 29.04.2013, wherein, it made submissions, as to why, interest in the sum of Rs. 24,32,179/-, ought not to have been demanded. 13.The Revenue, on the other hand, vide communication dated 14.06.2013, informed the Assessee, that its request for extension of time, could not be granted and therefore, there could be no waiver of interest. 13.1.Furthermore, v....
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....ed that the Tribunal had failed to appreciate that, since, the initial warehousing period had expired, the notice of demand, issued under Section 72(1) of the Act was valid and therefore, interest would have to be paid by the Assessee, as was held by the Supreme Court in SBEC Sugar Limited's case. 20.On the other hand, Mr.Viswanathan, submitted that there was no bar under Section 61 of the Act, in extending the period of warehousing, even if the application was moved, for the said purpose, after the expiry of the initial period of one year. 20.1.In support of this submission, the learned counsel relied upon the judgment of the Single Judge of the Bombay High Court in the matter of: Sunil Jugalkishore Gupta Vs. Union of India and Others, 1988 (36) E.L.T. 75 (Bom.). 20.2.Furthermore, the learned counsel for the Assessee submitted that since the Assessee had obtained a licence, under the EPCG Scheme on 20.03.2013, no duty could have been levied on the subject capital goods and therefore, there was no question of any interest being levied, as interest could be levied, only if duty was payable, at the time of clearance of goods. 20.3.Learned counsel, for this purpose, re....
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....ed by the Assessee, to the demand notice, issued by the Revenue, under Section 72(2) of the Act. (vii)The Revenue, however, most crucially, vide communication dated 09.04.2013, confined its demand, to interest, and that too, vis-a-vis the 1st and 2nd Bills of Entry. The total amount demanded was a sum of Rs. 24,32,179/-. This demand, was made, under Section 61 (2) (ii) of the Act read with CBEC Circular No.10/2006 CUS, dated 14.02.2006. (viii) The Revenue, finally declined the Assessee's request for grant of extension of time, vide communication dated 14.06.2013. The order-in-original was passed on 17.07.2013, which was assailed before the Tribunal, by the Assessee. The Tribunal, in the first round, allowed the Assessee's appeal, vide order dated 20.06.2014, requiring the Revenue, to re-examine the matter, as there had been a breach of principles of natural justice. 23.It is, in this background, that, in the second round, the order-in-original dated 07.10.2014/10.10.2014 came to be passed. 24.Given these admitted facts, what is required to be examined, by us, is, as to whether there is any impediment under the Act, in the Revenue, extending the wareh....
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....e (a) or sub-clause (aa) of sub-section (1), remain in a warehouse beyond the period specified in that sub-section by reason of extension of the aforesaid period or otherwise, interest at such rate as is specified in section 47 shall be payable, on the amount of duty payable at the time of clearance of the goods in accordance with the provisions of section 15 on the warehoused goods, for the period from the expiry of the said warehousing period till the date of payment of duty on the warehoused goods; (ii) specified in sub-clause (b) of sub-section (1), remain in warehouse beyond a period of ninety days, interest shall be payable at such rate or rates not exceeding the rate specified in section 47, as may be fixed by the Board, on the amount of duty payable at the time of clearance of the goods in accordance with the provisions of section 15 on the warehoused goods, for the period from the expiry of the said ninety days, till the date of payment of duty on the warehoused goods: Provided that the Board may, if it considers it necessary so to do in the public interest, by order and under circumstances of an exceptional nature, to be specified in such order, waive th....
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....affidavit merely says that the refusal was sent for communication to the petitioner and not that it was in fact communicated. The stand taken by the petitioner is consistent with the subsequent steps taken by him and the proposed transferee Lalit Ltd. Both of them in June and July 1985 executed different documents, which could only have been on the assumption that they anticipated acceptance of the proposed transfer. Therefore, even if it is assumed that the order of refusal was passed on 30.3.1985, it was not communicated to the petitioner. Mr.Ganesh relies upon various authorities in support of his submission that an application for extension could be entertained even after the expiry of initial bonding period. It is not necessary to refer to these cases for the language of the section extracted above, in particular the second proviso, leaves no room for doubt that no limitation as to when the extension should be applied for can be read into the section. That, coupled with the admitted position, that steps had not been taken to recover customs duty or the warehousing charges, indicates that the power to grant an extension had not come to an end. That apart, the initial response o....
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...., in our view, no interest could have been levied. 29.2.This is evident, upon a plain reading of the provisions of Section 62 (2) (ii) of the Act. The provision makes it clear that interest, is to be calculated, only on the "amount of duty payable" at the time of clearance of the subject goods, in accordance with the provisions of Section 15 of the Act. 29.3.The instant clearance, was under the provisions of Section 15 (1) (b) of the Act read with Section 68. This view is supported by the observations of the Supreme Court made in: Pratibha Processors Vs. Union of India, 1996 (88) E.L.T. 12 (S.C.). The relevant observations are extracted hereafter: "14. In the above backdrop, let us consider the scope and content of Section 61(2) of the Act as it existed at the relevant time. Section 61(1) prescribes the period during which the goods imported may remain in the warehouse. The normal period in different cases are provided therein. Extension of time in special cases is also provided. If the goods imported remain in warehouse beyond the period provided or extended under Section 61(1), the consequences are specified in Section 61 (2) of the Act. As per the provisions of th....