2015 (9) TMI 85 - HC - Customs

Import of arecanut - Benefit of concessional rate under Notification No.26/2000 Release of goods Petitioner was denied benefit of concessional rate of duty Respondent-2 directed petitioner to comply with certain conditions for provisional release of consignments of arecanut, that were imported by petitioner Petitioner is aggrieved by condition requiring payment of 35% of differential duty, stipulated as one of conditions for provisional clearance of consignments imported by him Held that - petitioner submitted documents with regard to origin of goods from Srilanka Petitioner has also placed reliance on Ext.P19-letter, that was issued by High Commission of Srilanka and addressed to Commissioner of Customs, confirming issuance of certificates of origin in respect of goods that were imported by petitioner Therefore petitioner succeeded in discharging his prima facie burden in establishing that goods qualified for benefit of concessional rate in terms of Notification Petitioner is entitled to obtain provisional release of goods more so because goods in question are perishable in nature Therefore, interests of justice would require to permit petitioner to provisionally clear goods on compliance with conditions mentioned inExt.P17 communication, except for payment of differential duty While payment that is required of petitioner in Ext.P17 communication is 35% of differential duty, court feel respondents will be justified in insisting only on payment of 20% of duty, relying on Customs (Provisional Assessment) Regulations Therefore, condition modified to payment of 20%, in lieu of 35% of differential duty On petitioner satisfying said conditions, respondents shall release goods on provisional basis Decided partially in favour of petitioner.

Summary

Issues involved:
Challenge against Ext.P17 order for provisional release of imported consignments of arecanut due to differential duty payment condition.

Analysis:
The petitioner imported arecanut from Srilanka seeking concessional customs duty rate under Notification No.26/2000. Customs authorities denied the benefit, suspecting the goods were not of Srilankan origin based on the presence of gunny bags suggesting sourcing from other countries. The authorities demanded 35% of the differential duty for provisional clearance, along with other conditions like submitting a bond. The petitioner objected to this condition, leading to the writ petition challenging Ext.P17 order.

The respondent argued that the goods did not qualify for concessional duty as per the notification due to doubts about their origin. They contended that provisional release could be allowed if the petitioner deposited a substantial amount towards the potential differential duty. The court noted the petitioner's submission of documents proving the goods' origin from Srilanka, including a declaration and a letter from the High Commission of Srilanka confirming the certificates of origin. The court found the petitioner had met the prima facie burden of establishing eligibility for the concessional rate.

The court decided to permit provisional clearance of the goods due to their perishable nature and the petitioner's successful discharge of the burden of proof. The court modified the payment condition from 35% to 20% of the differential duty, citing Customs (Provisional Assessment) Regulations. The judgment directed the respondents to allow the petitioner to clear the goods on payment of 20% of the differential duty and compliance with other specified conditions, emphasizing that this decision did not impact the pending adjudication by the respondents. The court instructed the respondents to complete the adjudication within six months from the date of the judgment to ensure timely resolution of the matter.