2005 (9) TMI 201 - AT - Customs

Summary

Issues:
1. Confirmation of interest amount and penalty under Section 28 of the Customs Act.
2. Applicability of interest on warehoused goods beyond the initial warehousing period.
3. Time limitation for issuance of Show Cause Notice for demanding interest.

Analysis:
1. The appeal was against the confirmation of interest amount and penalty under Section 28 of the Customs Act. The appellant had imported goods and availed warehousing facilities. The Show Cause Notice alleged interest charges on warehoused goods beyond the initial warehousing period. The appellant argued that once assessments were finalized, the question of seeking interest did not arise. The Show Cause Notice did not invoke a larger period or allege ingredients of proviso to Section 28 of the Customs Act. The appellant contended that the Notice issued after the lapse of six months was time-barred.

2. The Show Cause Notice did not invoke a larger period and did not allege ingredients of proviso to Section 28 of the Customs Act. The assessments had been completed, and duty was paid at the time of goods clearance. Citing the judgment in CCE v. Flock (India) Pvt. Ltd., the Tribunal noted that finalized assessments become appealable orders. If such orders are not challenged, the correctness of assessments cannot be subsequently challenged. Referring to the Tribunal ruling in CCE v. Hotline CPT Ltd., it was held that once assessment orders are finalized and not challenged, subsequent Show Cause Notices for interest would not be maintainable. Therefore, the appellant's contentions were accepted, and the appeal was allowed with consequential relief.

3. The Tribunal upheld the appellant's contentions that since assessments were finalized and not challenged, the subsequent Show Cause Notice for demanding interest was not maintainable. The absence of ingredients of proviso to Section 28 of the Customs Act further supported the appellant's argument that the Notice issued after the lapse of six months was time-barred. The appeal was allowed based on these grounds, with consequential relief granted if applicable.