1991 (9) TMI 201 - AT - Customs

Summary

Issues Involved:
1. Waiver of pre-deposit of differential duty.
2. Effective date of the customs duty notification.
3. Validity of the show cause notice issued by the Superintendent.
4. Competency of the Inspector to demand differential duty.
5. Time-barred nature of the show cause notice.

Detailed Analysis:

1. Waiver of Pre-deposit of Differential Duty:
The stay application was filed for the waiver of the pre-deposit of Rs. 7,23,820/- demanded by the Assistant Collector of Central Excise, Pune II, and confirmed by the Collector of Customs (Appeals), Bombay. The appellant requested the waiver on the grounds that the notification was made available to the public only on 1-11-1985, thus, they should only be liable for differential duty from that date onward.

2. Effective Date of the Customs Duty Notification:
The appellant argued that the effective date for any change in customs duty is the date of publication of the notification in the official gazette, not the date appearing on the notification. They cited the decision of the Madras High Court in the case of Asia Tobacco Co. Ltd. and provided evidence from the Assistant Controller (Periodicals) that the notification was made available on 1-11-1985. The Tribunal noted that although the appellants were aware of the notification on 8-10-1985, they continued to pay duty at the unamended rate throughout October. The Tribunal referred to the decision in Jaya Bharat International Ltd. v. Collector of Customs, holding that the date of publication is not relevant when the withdrawal of exemption is known to the assessee. Therefore, the duty was held to be valid from 8-10-1985.

3. Validity of the Show Cause Notice Issued by the Superintendent:
The appellant contended that the show cause notice issued on 16-9-1988 was time-barred as it sought to recover differential duty beyond six months. The Tribunal observed that the show cause notice was a continuation of ongoing correspondence initiated by the appellants themselves. The Tribunal referenced the Calcutta High Court judgment in Tarek Nath Sen v. U.O.I., stating that the notice issued by the Superintendent was an intimation of a proceeding without involving any judicial determination. Thus, the notice was valid.

4. Competency of the Inspector to Demand Differential Duty:
The appellant questioned the competency of the Inspector to issue a show cause notice demanding differential duty. The Tribunal noted that the Inspector, as the proper Bonding Officer, was competent to demand duty and that the appellants had partially complied with the demand, treating it as an intimation from the jurisdictional Assistant Collector. The Tribunal found no infirmity in the Inspector's intimation.

5. Time-barred Nature of the Show Cause Notice:
The appellant argued that the demand for differential duty was time-barred in the absence of a show cause notice served within the stipulated period of six months. The Tribunal found that the show cause notice issued on 16-9-1988 was the culmination of continuing correspondence and was not time-barred. The Tribunal also noted that the appellants had requested a formal show cause notice if the Assistant Collector still felt that the revised differential duty was payable.

Conclusion:
The Tribunal rejected the appeal and held that the appellants were liable to pay the differential duty from 8-10-1985. The stay application was disposed of as the issue in the appeal was decided. The Tribunal found no reason to interfere with the order passed by the lower authorities.