9911796707
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Issues Involved:
1. Delay in assessment of Bills of Entry by Customs Authorities. 2. Demand for enhanced duty under the Finance Act of 1992. 3. Claim of interest by Customs Authorities. Issue-wise Detailed Analysis: 1. Delay in Assessment of Bills of Entry by Customs Authorities: The petitioner imported 31.616 M. Ton of Prime Virgin HDPE Blow Moulding Grade and filed the Bill of Entry for warehousing on January 29, 1991. The Bill of Entry was assessed provisionally on March 5, 1991, but the Customs Authorities did not finalize the assessment despite repeated requests. The petitioner filed a writ petition due to the inaction of the Customs Authorities, leading to an interim order allowing clearance of goods upon payment of admitted duty and furnishing a P.D. Bond for the disputed amount. The Customs Authorities eventually issued a Show Cause Notice on December 12, 1991, and finalized the assessment on November 16, 1992, accepting the declared value of U.S. $ 890 per metric ton. The petitioner argued that the delay of about one year and eight months was solely due to the Customs Authorities' inaction, causing financial loss. The court noted that there were no extenuating circumstances justifying the delay, and the Customs Authorities accepted the petitioner's declared value without any changes. The court found the delay unjustified and held that the petitioner should not suffer financially due to the Customs Authorities' inaction. 2. Demand for Enhanced Duty under the Finance Act of 1992: The dispute also involved the demand for enhanced duty under the Finance Act of 1992, which came into effect on March 1, 1992. The petitioner contended that if the Bills of Entry had been assessed expeditiously, there would be no question of paying the enhanced duty. The court examined Section 15 of the Customs Act, which determines the rate of duty based on the date of actual removal of goods from the warehouse. The Supreme Court's judgment in Priyanka Overseas Pvt. Ltd. v. Union of India was cited, emphasizing that the rate of duty is determined on the date of actual removal from the warehouse. However, the court found that the Customs Authorities' delay in assessing the Bills of Entry was unjustified, and the petitioner had lodged the Bill of Entry for ex-bond clearance on March 26, 1991, nearly a year before the enhanced duty provisions came into effect. The court held that there was no valid reason for demanding the enhanced rate of duty from the petitioner and directed that the duty should be calculated at the rate in force before March 1, 1992. 3. Claim of Interest by Customs Authorities: The Customs Authorities demanded interest under Section 61(2) of the Customs Act after the expiry of the free period of ninety days from the date of warehousing. The petitioner argued that the goods remained in the warehouse due to the Customs Authorities' inaction, not due to any fault of the petitioner. The court noted that interest under Section 61(2) applies only if the importer avails warehousing facilities and fails to clear the goods within the prescribed period. In this case, the delay was due to the Customs Authorities' failure to assess the Bills of Entry within a reasonable time, and the assessable value declared by the petitioner was ultimately accepted. The court concluded that the levy of interest was unjustified and not warranted by Section 61(2) of the Customs Act, as the delay was caused by the Customs Authorities' inaction. Judgment: The writ petition was disposed of by directing the Customs Department to release the goods without charging any interest and to charge duty at the rate in force before the Finance Bill, 1992 came into effect, i.e., before March 1, 1992. All parties were directed to act on the signed copy of the operative part of the order.
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