2000 (1) TMI 315 - AT - Central Excise

Summary

Issues:
1. Applicability of special additional duty of customs on imported goods.
2. Interpretation of taxable event for customs duty on goods in a warehouse.

Issue 1: Applicability of special additional duty of customs on imported goods
The appeal challenged the imposition of special additional duty @ 4% on imported raw materials and components cleared for home consumption. The Commissioner of Customs and Central Excise (Appeals) upheld the duty, stating it was not a new levy but a revision of existing rates. The appellants argued that the duty should not apply to goods imported before the levy's introduction on 1-6-98, citing legal precedents. However, the Commissioner distinguished the cited cases and upheld the duty, leading to the appeal before the Tribunal.

Issue 2: Interpretation of taxable event for customs duty on goods in a warehouse
The Tribunal referred to the Supreme Court decision in Kiran Spinning Mills v. Collector of Customs, which clarified that the taxable event for customs duty occurs when goods cross the customs barrier. It was held that for goods in a warehouse, the customs barrier is crossed when they are removed for home consumption. Applying this precedent, the Tribunal found that since the duty was already leviable when the goods were cleared in January and February 1999, the appellants were liable to pay the special additional duty. The Tribunal rejected the appellants' argument of a conflict between Kiran Spinning Mills and a later Supreme Court decision, stating that the later decision did not directly apply to the present case.

In conclusion, the Tribunal upheld the imposition of the special additional duty on the imported goods, citing the legal interpretation of the taxable event and the applicability of the duty based on the timing of clearance. The appeal was dismissed, and the impugned order was upheld in line with the Supreme Court's decision in Kiran Spinning Mills.