1997 (3) TMI 174 - AT - Customs

Summary

Issues Involved:

1. Provisional Assessment under Section 18 of the Customs Act.
2. Time Limitation under Section 28 of the Customs Act.
3. Allegations of Mis-declaration, Mis-statement, and Suppression of Facts.
4. Execution and Discharge of Bond under Notification No. 150/81-Cus.
5. Relevant Date for Computing Limitation.

Issue-wise Detailed Analysis:

1. Provisional Assessment under Section 18 of the Customs Act:

The importer contended that there was no provisional assessment under Section 18 of the Customs Act and that the ex-bond Bills of Entry executed under Notification No. 150/81-Cus., dated 22-5-1981, would not make the assessment provisional. However, the Collector held that final assessment was to be made only after the production of an end-use certificate and its acceptance by the competent authority. The Tribunal referred to a similar case, Collector of Customs v. Indian Potash Ltd., where it was held that execution of a bond under a notification implied provisional assessment under Section 18. Thus, the Tribunal concluded that the assessment in the present case was provisional.

2. Time Limitation under Section 28 of the Customs Act:

The importer argued that the show cause notice was time-barred as it was issued beyond the six months period stipulated under Section 28 of the Customs Act. However, the Assistant Collector held that the assessment could only be final after the end-use certificate was furnished and accepted. The bond and bank guarantee were released on 11-8-1983, and the show cause notice was issued on 10-11-1983, thus within six months from the date of discharge of the bond. The Tribunal upheld this view, stating that the relevant date for computing limitation is the date of adjustment of duty after the final assessment, aligning with the precedent set in the Indian Potash Ltd. case.

3. Allegations of Mis-declaration, Mis-statement, and Suppression of Facts:

The Assistant Collector rejected the plea of time bar, citing the importer's failure to submit correct Bills of Entry and their omission to incorporate the Auxiliary duty chargeable, thereby making mis-statements and suppressing facts with an intent to evade payment of duty. However, the Tribunal found that the show cause notice did not allege grounds of mis-statement or suppression to invoke a larger period under Section 28. Therefore, the Tribunal concluded that there was no justification to invoke a larger period in the present case.

4. Execution and Discharge of Bond under Notification No. 150/81-Cus:

The bond executed by the importer under Notification No. 150/81-Cus., dated 22-5-1981, was central to the case. The Tribunal noted that the bond's terms required the importer to pay any differential duty if the end-use certificate was not furnished. This bond, executed under the notification, was deemed equivalent to a provisional assessment under Section 18. The Tribunal referenced the Indian Potash Ltd. case to affirm that such bonds imply provisional assessment, and the relevant date for limitation purposes is the date of bond discharge.

5. Relevant Date for Computing Limitation:

The Tribunal emphasized that the relevant date for computing the limitation period under Section 28(3)(b) of the Customs Act is the date of adjustment of duty after final assessment. In this case, the bond was discharged on 11-8-1983, and the show cause notice issued on 10-11-1983 was within the permissible six months period. The Tribunal found no merit in the importer's argument that the bond was not executed in terms of Section 28(3)(b).

Conclusion:

The Tribunal rejected the appeal, holding that the assessments were provisional, the demands were raised within the permissible period, and the importer's arguments regarding mis-statement and suppression were not substantiated by the show cause notice. The appeal was dismissed, affirming the demands raised by the department.