TaxTMI 
TaxTMI 
1996 (8) TMI 109
X X X X Extracts X X X X
X X X X Extracts X X X X
....e to an end on 15th September, 1984. On 8th May, 1985, the Assistant Collector of Customs issued to the appellants a demand notice under Section 72(1) of the Act. It recorded that the said bales remained in the bonded warehouse although the period of warehousing had not been extended beyond 15th September, 1984. The appellants had, therefore, become liable to pay in respect of the said bales Customs duty in the sum of Rs. 6,73,885.80, countervailing duty in the sum of Rs. 1,63,657.98 and interest at the rate of 12 per cent per annum in the sum of Rs. 67,003.52 for the period 16th September, 1984 to 15th May, 1985, under the provisions of Section 72(1)(b). Giving credit for the amount of Rs. 8,03,458.32 which had been deposited by the appellants, the appellants were called upon to pay Rs. 1,01,088.98 plus interest after 15th May, 1985, till the date of removal of the said bales from the bonded warehouse. If the amount was not paid within 7 days of receipt of the demand notice, it was recoverable in terms of the provisions of Section 72(2), without prejudice to any other mode of recovery. On 30th May, 1985, the appellants filed a bill of entry for ex-bond clearance of the said bales ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... bill of entry, as provided in Section 15(1)(b) read with the proviso to Section 15(1) and Section 46. The Customs authorities had charged duty on the said bales at this rate under the provisions of Section 72. Interest was also recoverable from the appellants for storage of the said bales after expiry of the bonding period. There was, therefore, no illegality in the order of the Customs authorities and the appeal was dismissed. 5.Section 2 of the said Act is its definition section. Under sub-section (43), "warehouse" means a public warehouse appointed under Section 57 or a private warehouse licensed under Section 58. Under sub-section (44), "warehoused goods" means goods deposited in a warehouse. Section 12 requires that Customs duty shall be levied, at such rates as are specified in the Customs Tariff Act or any other law for the time being in force, on goods, imported into India. Section 15, insofar as is relevant, reads thus :- "SECTION 15. Date for determination of rate of duty and tariff valuation of imported goods. - (1) The rate of duty and tariff valuation, if any, applicable to any imported goods, shall be the rate and valuation in force, - (a) ......................
X X X X Extracts X X X X
X X X X Extracts X X X X
.... diplomatic mission; or goods intended for use in any manufacturing process or other operations in accordance with the provisions of section 65; or goods intended for use in any hundred per cent export-oriented undertaking; or goods which the Central Government may, if it is satisfied that it is necessary or expedient so to do, by notification in the Official Gazette, specify for the purposes of this clause, till the expiry of one year. Explanation. - For the purposes of sub-clause (iv), "hundred per cent export-oriented undertaking" has the same meaning as in Explanation 2 to sub-section (1) of section 3 of the Central Excises and Salt Act, 1944 (1 of 1944); in the case of any other goods, till the expiry of three(b) months, after the date on which the proper officer made an order under section 60 permitting the deposit of the goods in a warehouse; Provided that :- in the case of any goods which are likely to deteriorate,(i) the aforesaid period of one year or three months, as the case may be, may be reduced by the Collector of Customs to such shorter period as he may deem fit; in the case of any goods which are not likely to(ii) deteri....
X X X X Extracts X X X X
X X X X Extracts X X X X
....to another warehouse. Section 72 reads thus :- "SECTION 72. Goods improperly removed from warehouse, etc. - (1) in any of the following cases, that is to say, - where any warehoused goods are removed from a warehouse in(a) contravention of section 71; where any warehoused goods have not been removed from a(b) warehouse at the expiration of the period during which such goods are permitted under section 61 to remain in a warehouse; where any warehoused goods have been taken under section 64(c) as samples without payment of duty; where any goods in respect of which a bond has been(d) executed under section 59 and which have not been cleared for home consumption or exportation are not duty accounted for to the satisfaction of the proper officer, the proper officer may demand, and the owner of such goods shall forthwith pay, the full amount of duty chargeable on account of such goods together with all penalties, rent, interest and other charges payable in respect of such goods. (2) If any owner fails to pay any amount demanded under sub-section (1), the proper officer may, without prejudice to any other remedy, cause to be detained and ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e by the proper officer on the bill of entry. Learned counsel for the appellants, however, drew our attention to a letter dated 22nd July, 1988, written by the Customs authorities in reply to an inquiry by the appellants about their ex-bond bill of entry for home consumption filed on 30th May, 1985, in respect of the said bales. The letter stated that the bill of entry could not be traced in the Customs records but, "As per our record, the said Bill of Entry for ex-Bond clearance for home consumption for clearing 832 of Wood Pulp from the Private Bonded Warehouse at Mogra was filed by you on 30-5-1985." By reason of this letter of the Customs authorities, we proceed upon the basis that the appellants had filed a bill of entry for home consumption on 30th May, 1985, in respect of the said bales, but there is nothing to indicate that an order for clearance thereon had been made. 10.Section 61 prescribes the period for which goods may be warehoused. They may be left in the warehouse in which they are deposited for the period of one year if they are such goods as are referred to in clause (a) of sub-section (1), and for the period of three months counted from the date of the order p....
X X X X Extracts X X X X
X X X X Extracts X X X X
....or its permitted extension. The importer of the goods may be called upon to pay Customs duty on them and, necessarily, it would be payable at the rate applicable on the date of their deemed removal from the warehouse, that is, the date on which the permitted period or its permitted extension came to an end. 14.Section 15(1)(b) applies to the case of goods cleared under Section 68 from a warehouse upon presentation of a bill of entry for home consumption; payment of duty, interest, penalty, rent and other charges; and an order for home clearance. The provisions of Section 68 and, consequently, of Section 15(1)(b) apply only when goods have been cleared from the warehouse within the permitted period or its permitted extension and not when, by reason of their remaining in the warehouse beyond the permitted period or its permitted extension, the goods have been deemed to have been improperly removed from the warehouse under Section 72. 15.The decision in the case of D.C.M. and Another v. Union of India and Another cited by learned counsel for the appellants dealt with, and upheld, the constitutionality of Section 15(1)(b). It did not deal with a situation where goods continued to....