TaxTMI 
TaxTMI 
2025 (11) TMI 1573
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....at the imported goods were appropriately classifiable under CTH 27079900. A show Cause Notice, dated 24.02.2016 along with a corrigendum dated 13.10.2016, was issued to finalise assessments; Order in Original was issued on 29.12.2017 confirming the differential duty of Rs 45 Lakhs; on an appeal filed by the appellants, Commissioner (Appeals) upheld the original order vide order dated 29.12.2019. 3. Shri Naveenn Bindal, Learned Counsel for the appellants submits that impugned order is bad in law, contravenes the provisions of Customs Act, 1962 and the Principles of Natural Justice for the following reasons. * the order dated 29.12.2017, issued to finalise assessment, is clearly time barred as the assessment has been made after expiry of five years from the date of provisional assessment; no reasons are explained in the impugned orders for delay in finalising assessment. * As per supplementary instructions provided in CBEC's Customs manual, final assessment has to be made within six months of provisional assessment; * though Section 18 provides no time period for finalising the assessment, it has to be made within reasonable time; * After fi....
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.... Section 18 does not lay down any time period; CBIC's instruction that the finalisation be completed within 6 months' can not override the statutory position; reliance on the case of Bihar foundry is misplace as the issue pertains to post 2018 and Show cause Notices were issued after 6-9 years; in the instant case it was issued in shorter period. * It's incorrect that the impugned goods were interjected due to DRI alert; DRI alert was a legitimate intelligence input; the goods proved to be mis-declared; * Principles of natural justice were not violated as number of opportunities were given to the appellant; cross examination of CRCL Chemist was not allowed as it was not an absolute right. * Its incorrect to say that Section 28 is for Recovery; demand directly flows from Section 18 and issuing a separate SCN is redundant and unnecessary; Section 28 is not enforcing recovery, rather it is enforcing the demand crated by Section 18; * Section 18 as it existed contained the inherent power to finalise the assessment; sub-section (2) of Section 18 says that when duty leviable on such goods is assessed finally.......; it means the officer had power to fi....
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....ars. We find that it's incorrect to say, at least for the departmental officers, that the CBEC instructions cannot override the statutory provisions. That is not the spirit of manual of instructions either. Courts and tribunal have been consistently holding that wherever statute has not provided time limits, the same needs to be done in the overall time frame of the statute. If a demand cannot be issued after a period of 5 years, provisional assessments too cannot be finalised beyond that period, there too without valid reasons. In the instant case we find therefore, that there has been inordinate delay and there too a demand is issued after 5 years and therefore, the proceedings are vitiated. 6. We find that the Hon'ble Supreme Court held in the case of ITC 2006 (203) ELT 532(SC) held that finalisation of provisional assessment sine qua non for issuance of notice under Section 11A. The same was reiterated by Delhi High Court in the case of ITC Ltd 2010(250)ELT 189 and it was also followed by the Tribunal in the case of Thermax Ltd 2015(317) ELT100 (Tribunal-Bom). Hon'ble Supreme Court held in the case of ITC Ltd (Supra) that: 17. Section 11A of the Act provides for a p....
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....se is resorted to only when the conditions laid down therein are satisfied, viz., where the assessee is found to be unable to produce any document or furnish any information necessary for assessment of duty on any excisable goods. 22. Whereas provisional duty is levied in terms of Sub-Rule (1) of Rule 9B, final assessment is contemplated under Sub-Rule (5) thereof by reason of which the duty provisionally assessed shall be adjusted against the duty finally assessed and in the event, the duty provisionally assessed falls short of or is in excess of the duty finally assessed, the assessee will pay the deficiency or will be entitled to a refund, as the case may be. Ultimately, thus, the liability of the assessee would depend upon the undertaking of exercises by the assessing officer to complete the assessment proceeding as contemplated under the Rules. 23. On a plain reading of the provisions of the Act and the Rules framed thereunder, we have no doubt in our mind that the Tribunal was correct in its finding that the impugned show cause notices were illegal. 24. The question came up for consideration before this Court in Serai Kella Glass Works Pvt. Ltd. v. ....
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....for the petitioner. It is evident from the record that import of goods in the present case was made by the petitioner more than five years prior to the issuance of notice and provisional assessment. More than five years prior to issuance of show cause notice, even the representative samples had also been drawn and the test reports from the laboratory were received, but still the department thought it appropriate to sleep over the matter for five years. Issue as to what should be the reasonable time in the absence of statutory period prescribed in the Act for taking any action was considered by Hon'ble the Supreme Court in State of Punjab v. Bhatinda District Co-op. Milk P. Union Limited, 2007 (217) E.L.T. 325, wherein it was opined that five years would be the reasonable period in the absence of any time prescribed in the Act. 12. Issue was further considered by this Court in M/s. GPI Textiles Limited's case (supra), where notice issued beyond five years period under the Central Excise Act, 1944, was as set aside as the period was found to be unreasonable. Earlier two judgments of the Gujarat High Court in Siddhi Vinayak Syntex Private Limited v. Union of India, 2017 (352)....
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....hile it is true that the Legislature has provided for such abiding by the time limit where it is possible to do so, sub-section (11) of section 11A of the Act gives an indication as to the legislative intent, namely that as far as may be possible the amount of duty should be determined within the above time frame, viz. six months from the date of the notice in respect of cases falling under sub-section (1) and one year from the date of the notice in respect of cases falling under sub-section (4) or sub-section (5). When the Legislature has used the expression "where it is possible to do so", it means that if in the ordinary course it is possible to determine the amount of duty within the specified time frame, it should be so done. The Legislature has wisely not prescribed a time limit and has specified such time limit where it is possible to do so, for the reason that the adjudicating authority for several reasons may not be in a position to decide the matter within the specified time frame, namely, a large number of witnesses may have to be examined, the record of the case may be very bulky, huge workload, non-availability of an officer, etc., which are genuine reasons for not bei....
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....- Union of India and others v. M/s. Siddhi Vinayak Syntex Private Limited, in which notice has been issued only to the extent as to whether Circular No. 162/73/95- CX, dated 1412-1995, issued by the Central Board of Excise and Customs, Department of Revenue, Ministry of Finance, Government of India, is in conformity/authorized by the provisions of Section 37B of the Central Excise Act, 1944. The order on merit has been upheld vide order dated 28-72017. 16. The view expressed in M/s. Siddhi Vinayak Syntex Private Limited's case (supra) was subsequently followed by Gujarat High Court in Parimal Textiles' case (supra), where again belated order passed after issuing show cause notice, was set aside." 13. Another fact, which was pointed out by Learned Counsel for the petitioner was that under Section 18 of the Act there is no period provided for framing final assessment after the goods are released, however, in Chapter 7 of the Board's Manual, the period provided is six months. Even under Section 28 of the Act for issuance of a notice for recovery of any duty not levied or short levied or erroneously refunded, the period is one year, which is extendable to five years i....