2001 (2) TMI 344 - AT - Customs

Summary

Issues:
1. Duty demand under Section 28 of the Customs Act, 1962 invoking the extended period.
2. Applicability of the extended period based on suppression of facts by the importers.
3. Discrepancy in opinion between Customs Authorities regarding eligibility for exemption.
4. Justification for invoking the extended period under Section 28 of the Customs Act.

Analysis:

1. The judgment involves a duty demand made against the appellant under Section 28 of the Customs Act, 1962, invoking the extended period available under the proviso to Section 28(1). The impugned order confirmed a duty demand against two firms for suppressing facts about the imported goods to benefit from a concessional rate of duty.

2. The appellants contended that they had disclosed full particulars about the goods in the import documents, specifically mentioning the goods as "Nylon Tricot Flock Fabric sheet in rolls for making insole/insock for leather footwear." The Customs Authorities allowed concessional assessment based on this declaration. However, a show cause notice was issued later, alleging mis-declaration and proposing to recover the differential duty under the extended period.

3. A discrepancy arose between Customs Authorities regarding the eligibility of the imports for exemption. While the Commissioner of Customs, Bombay believed the goods were eligible, the Additional Director General of Revenue Intelligence, Bombay disagreed. A circular issued to clarify the assessment practice further complicated the situation.

4. The judgment concluded that the Circular dated 6-10-1998 could not be the basis for reassessing goods already cleared, especially when the invoice clearly stated the intended use for making "Insole, sock, insock for leather footwear." As the Customs Authorities were aware of this information from the invoice itself, the appellants were not deemed to have made any mis-declaration. Consequently, the duty demand beyond the normal period of six months was held to be time-barred, and the appeal was allowed with the impugned order set aside, leading to the cancellation of penalties imposed.