2012 (10) TMI 631 - AT - Customs

Forged Release Advice - DEPB License - seizure of goods - demand of duty, interest thereon & penalty - Whether the provisional assessment resorted to under Rule 9B read with Rule 173J would render assessment provisional as a whole? - Held that - As decided in COLLECTOR OF CENTRAL EXCISE, MADRAS Versus INDIA TYRE & RUBBER CO. LTD. 1997 (1) TMI 100 - HIGH COURT OF JUDICATURE AT MADRAS the provisional assessment made is provisional for all purposes, and is not to be treated as provisional only in respect of a particular ground considered. The assessment is either provisional or final, and if it is provisional, it retains that character of being provisional for every purpose and cannot be treated as final in respect of a matter not considered. What is material is the ultimate character of the order of assessment whether it is provisional or final. It is undisputed that the Bills of Entry which were filed by the appellant were provisionally assessed by the adjudicating authority and before finalization of the claim, Show Cause Notice was issued for recovery of duty from the appellant, thus once a Bill of Entry is provisionally assessed, unless the said provisional assessment is finalized by the lower authorities, demand of duty, if any, under Section 28 of Customs Act, 1962 will not arise - remand the matter back to the adjudicating authority to reconsider the issue afresh after considering the appellant s submissions as regards the Bills of Entry are not finally assessed - in favour of assessee.

Summary

Issues:
Utilization of license/release advice and DEPB for clearance of goods for home consumption, recovery of duty under Section 28 of Customs Act, 1962, confiscation of goods under Section 111(oo) of Customs Act, 1962.

Analysis:
The appellant imported Crude Palmolein and Crude Soya Bean Oil, claiming exemption under Notification No.34/1997. However, investigations revealed that a Release Advice (RA) used by the appellant was forged. The adjudicating authority held that the appellant was not entitled to the exemption due to the forged RA and imposed duty liability, interest, and penalty under Section 114A of Customs Act, 1962. The seized goods were deemed liable for confiscation under Section 111(o) of Customs Act, 1962. The penalty under Section 112 was not imposed as penalty under Section 114A was already levied.

The first appellate authority upheld the Order-in-Original, directing the appellant to deposit Rs.2 lakhs to proceed with the appeal. The appellant argued that since the Bills of Entry were provisionally assessed, duty recovery under Section 28 could not be demanded until finalization. Citing legal precedents, the appellant sought a remand for reconsideration based on the provisional assessment status of the Bills of Entry.

The Tribunal noted that the issue centered around the utilization of license/release advice and DEPB for goods clearance. Emphasizing the provisional assessment status of the Bills of Entry, the Tribunal referred to the Chennai High Court judgment, stating that demand under Section 28 cannot be raised until finalization of provisionally assessed Bills of Entry. Thus, the matter was remanded to the adjudicating authority for fresh consideration, instructing to finalize the provisional assessment before any demand imposition, ensuring adherence to natural justice principles.

In conclusion, the Tribunal set aside the impugned order, remanding the case for reconsideration by the adjudicating authority, emphasizing the need to finalize the provisional assessment before imposing any demands, and ensuring compliance with natural justice principles. The operative portion of the order was pronounced in court, setting the stage for a fresh review of the case.