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2016 (9) TMI 670 - HC - CustomsEffective date of notification - Notification No.36/2001-Cus(NT) dated 03.08.2001 - notification issued for publication in the gazette on 03.08.2001 - gazette made available to public on 07.08.2001 - Circular No.46/2001 dated 10.08.2001 - import of edible oil including palmolein oil - bill of entry for home consumption was filed on 03.08.2001 - powers conferred to fix the tariff value - Section 14(2) of the Customs Act, 1962 - customs duty paid on invoice value 248 U.S. dollars - whether liablity to pay customs duty at the tariff value, fixed under Notification No.36/2001, of 372 U.S. dollars per metric tonne correct? Held that - the decision in the case Param Industries Ltd 2015 (6) TMI 732 - SUPREME COURT is relied upon where it was held that Notification No.36/2001 came into force on or after 06.08.2001, the action of the respondents in applying the tariff value prescribed therein, for the earlier import of R.B.D. Palmolein oil on 03.08.2001, is illegal. Customs duty on R.B.D. Palmolein oil, imported on 03.08.2001, could only have been levied on its invoice value, and not on the tariff value prescribed subsequently in Notification No.36/2001 dated 03.08.2001. The High Court has stated that for bringing the notification into force and make it effective, two conditions are mandatory, viz., (1) Notification should be duly published in the official gazette, (2) it should be offered for sale on the date of its issue by the Directorate of Publicity and Public Relations of the Board, New Delhi. In the present case, admittedly, second condition was not satisfied inasmuch as it was offered for sale only on 06.08.2001, as it was published on 03.08.2001 in late evening hours and 04/05.08.2001 were holidays - the notification will be effective only from 06.08.2001. Petition disposed off - decided in favor of petitioner.
Issues Involved:
1. Validity and enforceability date of Notification No.36/2001-Cus(NT) dated 03.08.2001. 2. Ultra vires status of Circular No.46/2001 dated 10.08.2001. 3. Legality of the assessment order based on the tariff value fixed by Notification No.36/2001. Issue-wise Detailed Analysis: 1. Validity and Enforceability Date of Notification No.36/2001-Cus(NT) dated 03.08.2001: The petitioner argued that Notification No.36/2001-Cus(NT) dated 03.08.2001 came into force only on 07.08.2001 when it was made available to the public, relying on the Supreme Court's judgment in Union of India v. Param Industries Ltd. The respondents contended that the notification was effective from 03.08.2001, the date it was published in the Official Gazette, as per Section 14(2) of the Customs Act. The Court examined whether the notification applied to goods imported on 03.08.2001. It referred to the Karnataka High Court's decision in Param Industries Ltd., which held that the notification was not published on 03.08.2001 but on 06.08.2001. The Supreme Court affirmed this view, stating that the notification was effective only when it was offered for sale, which was on 06.08.2001. 2. Ultra Vires Status of Circular No.46/2001 dated 10.08.2001: The petitioner contended that Circular No.46/2001, which clarified that Notification No.36/2001 came into effect on 03.08.2001, was ultra vires Section 14(2) of the Customs Act. The respondents argued that the date in the Gazette notification should be presumed as the publication date. The Court referred to judgments that emphasized the requirement of publication in the Official Gazette for a notification to be effective. The Court found that the notification was published on 06.08.2001, not 03.08.2001, making Circular No.46/2001 ultra vires. 3. Legality of the Assessment Order Based on the Tariff Value Fixed by Notification No.36/2001: The petitioner argued that the customs duty should be based on the invoice value of 248 U.S. dollars per metric tonne, as the bill of entry for home consumption was filed on 03.08.2001, before the notification was effective. The respondents contended that the tariff value of 372 U.S. dollars per metric tonne, as per Notification No.36/2001, was applicable. The Court referred to the Karnataka High Court's decision in Param Industries Ltd., which held that the notification was effective from 06.08.2001. The Supreme Court affirmed this view, stating that the notification was effective only when it was offered for sale. Therefore, the Court concluded that the customs duty should be based on the invoice value, making the assessment order based on the tariff value illegal. Conclusion: The Court held that Notification No.36/2001-Cus(NT) dated 03.08.2001 came into force on 06.08.2001, not 03.08.2001. Circular No.46/2001 was ultra vires Section 14(2) of the Customs Act. The assessment order based on the tariff value fixed by Notification No.36/2001 was illegal. Customs duty on RBD Palmolein oil imported on 03.08.2001 should be based on the invoice value. Both Writ Petitions were allowed without costs.
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