1962 (2) TMI 4 - HC - Customs

Summary

Issues Involved:
1. Whether the provisions contained in Sections 29A and 29B of the Sea Customs Act are complementary or mutually exclusive.
2. Legality of converting assessments made under Section 29A into provisional assessments under Section 29B.
3. The finality and reassessment conditions of assessments made under Section 29A.
4. The conditions and applicability of provisional assessments under Section 29B.
5. The procedural and legal implications of the Customs Authorities' actions.
6. The appellant's conduct and its impact on the appeals.

Issue-wise Detailed Analysis:

1. Complementary or Mutually Exclusive Provisions:
The primary issue was whether Sections 29A and 29B of the Sea Customs Act are complementary or mutually exclusive. The court held that the provisions of Sections 29A and 29B are not complementary but mutually exclusive. Section 29A allows for assessment of duty prior to examination of goods based on the statements in the bill of entry, which becomes final unless proven untrue. Section 29B, on the other hand, deals with provisional assessments where further proof or tests are required before final assessment. The court emphasized that each section contemplates a distinct set of circumstances and procedures, and they cannot be interchangeably applied.

2. Legality of Converting Assessments:
The court found that converting assessments made under Section 29A into provisional assessments under Section 29B is not permitted by law. Section 29A assessments are final unless the statements in the bill of entry are proven false. Section 29B applies when there is a need for further information or tests before final assessment. The court stated, "We do not think that this procedure is permitted by the law," and reiterated that the two sections are designed for different scenarios and should not be mixed.

3. Finality and Reassessment under Section 29A:
The court clarified that assessments under Section 29A are final unless the statements in the bill of entry are found untrue upon examination or other means. The court stated, "Assessment under Section 29A is final subject to its being reopened only on proof of certain condition." This finality is subject to reassessment only if the basis of the initial assessment is proven to be false.

4. Conditions and Applicability of Section 29B:
Section 29B allows for provisional assessment under three specific conditions: (a) when the owner cannot provide full information, (b) when further proof is required despite full information, and (c) when goods need to be tested. The court emphasized that one of these conditions must be present for provisional assessment to be justified. The court noted, "One or other of these three conditions must be present to authorise provisional assessment of duty."

5. Procedural and Legal Implications:
The court highlighted that the Customs Authorities' actions of converting Section 29A assessments into Section 29B provisional assessments were not legally permissible. The court stated, "Indeed that is the admitted position as will appear from the excerpts we have set out from the affidavit sworn by the Assistant Collector of Customs himself." The court concluded that such actions were not allowed by the law and directed the Customs Authorities to proceed in accordance with the correct legal provisions.

6. Appellant's Conduct and Impact on Appeals:
The Customs argued that the appellant's compliance with the department's requisition for additional deposits indicated acquiescence to the provisional assessments. However, the court found that the appellant's compliance was in pursuance of an interim court order and did not constitute giving up the appeals. The court stated, "We do not think this conduct on the part of the appellant can have the effect of giving up the appeals."

Conclusion:
The appeals were allowed, and the orders of the trial judge were set aside. The court directed the Customs Authorities to proceed based on assessments made under Section 29A and ordered the refund of deposits and discharge of bonds executed by the appellant. The court issued writs of mandamus directing the Customs Authorities to forbear from giving effect to the contested orders and ruled that there would be no order as to costs in these appeals.