2009 (1) TMI 246 - AT - Customs

Warehoused goods interest 5 working days held that - goods are warehoused the period of warehousing is governed by Section 61 of the Customs Act 1962. The very purpose of warehousing is to postpone the duty demand. It is a facility given by the Revenue to the importers. In terms of the Section 61 the initial warehousing period is 90 days. That means if any clearance is made within the initial warehousing period only duty has to be paid and not interest - period of 5 days from the date of return of the assessed Bills of Entry under Section 47 applies to the Bills of Entry for home consumption only

Summary

Issues: Revenue's appeal against Order-in-Appeal regarding duty payment timeline and interest calculation for goods cleared from warehouse.

Analysis:
1. The Revenue filed an appeal against Order-in-Appeal No. 22/2008 challenging the demand of interest amounting to Rs. 7,34,025 for not depositing duty within 05 days of return of Ex-bond Bills of Entry after assessment.
2. The Commissioner (Appeals) concluded that Section 61(2)(ii) of the Customs Act, 1962 allows a 90-day interest-free warehousing period, and interest is payable beyond that period till the duty payment date.
3. The Commissioner relied on the Tribunal's decision in Ispat Industries Ltd. v. CCE, Nagpur, stating that interest is payable from the expiry of the warehousing period till the duty payment date.
4. The Revenue contended that interest starts accruing after the assessment and return of Bill of Entry, citing the case of Pesticide Industries v. Collector of Customs, Jaipur.
5. The Revenue also mentioned an appeal against the Ispat Industries Ltd. case, pending before the High Court, as a reason for non-acceptance of the Commissioner's decision.
6. The Tribunal held that the warehousing period under Section 61 determines duty payment timelines, with the initial 90 days being interest-free. The 5-day timeline under Section 47 applies to Bills of Entry for home consumption only, as established in previous judgments like Ispat Industries and Maharashtra Seamless Ltd.
7. The Tribunal noted that being bound by decisions of coordinate Benches on similar issues, the appeal lacked merit, and hence, rejected the Revenue's appeal.

This detailed analysis covers the issues raised in the Revenue's appeal regarding duty payment timelines and interest calculation for goods cleared from the warehouse, providing a comprehensive overview of the Tribunal's judgment and the legal reasoning behind it.