2009 (5) TMI 312 - AT - Customs

Extension of warehousing periods - we find that the appellants did not apply for extension of the warehousing period to the Commissioner either within the warehousing period or within the period up to which the Commissioner could have extended the same. We also find that the appellants did not apply to the Chief Commissioner for extension of the warehousing period. On application for extension of period three years after its expiry, Commissioner of Customs (Port) has permitted to clear the goods by paying Customs duty at the rate that prevailed on the date of expiry of warehousing period with interest - Hence, the communication from the department to the appellants asking them to pay duty and interest with reference to the expiry of the warehousing period in March and August, 2001, is, therefore, legal and proper and such communication cannot be considered as granting extension of the warehousing period since the Commissioner had no power to grant extension beyond six months. As such, the order appealed against does not require any interference. Consequently, the appeal is dismissed

Summary

Issues:
1. Extension of warehousing period for imported goods.
2. Applicability of legal provisions under the Customs Act, 1962.
3. Interpretation of communication from the Commissioner regarding payment of duty and interest.
4. Comparison of cited legal precedents with the current case.

Extension of Warehousing Period:
The appellants imported goods and stored them in a Private Bonded Warehouse with warehousing periods expiring in 2001. They cleared some goods before expiry but requested an extension for the remaining pallets in 2004. The Commissioner's communication directed duty payment based on the expiry dates in 2001. The Tribunal found that the appellants did not seek extension before expiry, as required by law, and failed to approach the Chief Commissioner for extensions beyond six months. The communication did not extend the warehousing period, as the Commissioner lacked authority to do so beyond six months.

Legal Provisions under Customs Act, 1962:
The Tribunal highlighted Section 61 of the Customs Act, specifying warehousing periods and extension limits. It emphasized that the Commissioner could only extend by six months, and the Chief Commissioner had authority for further extensions. The appellants' failure to seek extensions within the legal framework led to the dismissal of their appeal.

Interpretation of Communication from Commissioner:
The communication from the Commissioner clarified duty and interest payment based on the expiry dates in 2001, in line with legal precedents like the Supreme Court's decision in the case of Kesoram Rayon. The Tribunal emphasized that the communication did not grant an extension of the warehousing period, as the Commissioner's power was limited to a six-month extension.

Comparison of Legal Precedents:
The appellants cited previous decisions to support their case, but the Tribunal found that the legal position established by the Supreme Court in the Kesoram Rayon case was decisive. The Tribunal rejected the applicability of earlier decisions due to the clarity provided by the Supreme Court's detailed order. The Tribunal concluded that the appellants' failure to follow legal procedures for extension rendered the Commissioner's communication lawful, leading to the dismissal of the appeal.

In conclusion, the Tribunal upheld the Commissioner's communication regarding duty and interest payment, emphasizing the appellants' non-compliance with extension procedures under the Customs Act, 1962. The appeal was dismissed based on the legal framework and precedents cited in the judgment.