2007 (6) TMI 342 - AT - Customs

Summary

Issues involved: Stay of operation of impugned order regarding interest on amount debited in DEPB for import of goods.

Summary:
1. The Revenue filed applications for stay of operation of an order where the Commissioner (Appeals) rejected the claim for interest on an amount debited in DEPB for import of goods by the respondents.

2. The respondents imported goods under a customs duty exemption but delayed clearing the warehoused goods. The Revenue claimed interest on the amount debited in DEPB due to the delay, citing the importer's liability for interest on warehoused goods. The original authority upheld the demand, but the Commissioner (Appeals) set it aside.

3. The JDR argued that the exemption under the Notification required a debit in DEPB, akin to duty payment, and thus interest should be levied. Referring to a Tribunal decision, the JDR contended that DEPB debit was for Basic Customs Duty and Additional Customs Duty only.

4. Upon review, it was found that the DEPB debit was specifically for BCD and CVD, not other duties. As no customs duty was paid by the respondents, the Revenue failed to establish a case for interest recovery. The JDR acknowledged that the DEPB credit did not represent customs duty, negating the basis for interest levy.

5. Consequently, both applications for stay were dismissed as the Revenue could not prove the DEPB debit was for customs duty, precluding the levy of interest.