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2018 (5) TMI 1147 - AT - CustomsBenefit of N/N. 1(RE-2008)/2004-09 dated 11.4.2008 - Failure of customs authorities to issue notification on time - while policy was amended w.e.f. 1.4.2008, the notification of customs implementing the said change was issued on 9.5.2008 also 39 days after the issue of DGFT notification. Held that - it is apparent that when the EXIM Policy was amended and notified the Government has taken the decision of revised customs duty under the EPCG from 5% to 3%. To enforce this decision, the Ministry of Finance, Department of Revenue was required to act in tandum with the DGFT and Ministry of Commerce - In the instant case, the appellants were also issued a license as well as authorization prescribing 3% rate of duty. In these circumstances, failure of customs authorities to issue notification on time cannot be held against the respondent - appeal dismissed - decided against Revenue.
Issues:
- Appeal against Commissioner (Appeals) order permitting reassessment of Bills of Entry under EPCG authorization scheme at a concessional rate of duty. - Interpretation of conflicting customs duty notifications and their applicability to the Bills of Entry filed on 7.5.2008. - Consideration of the delay in issuing corresponding customs notification revising the duty rate from 5% to 3% and its impact on the duty liability of the respondents. - Analysis of the principle of promissory estoppel in relation to the government's decisions on duty rates under the EPCG scheme. Analysis: 1. The appeal before the Appellate Tribunal CESTAT MUMBAI was lodged by the Commissioner of Customs challenging the order of the Commissioner (Appeals) allowing reassessment of Bills of Entry filed under the EPCG authorization scheme. The dispute arose from conflicting customs duty notifications, specifically Notification No. 97/04 and Notification No. 64/08, which prescribed different duty rates of 5% and 3% respectively. 2. The learned AR representing the appellant contended that the Bills of Entry were assessed on 7.5.2008 under Notification No. 97/04, which imposed a duty rate of 5%. However, the respondents argued for reassessment based on Notification No. 1(RE-2008)/2004-09 dated 11.4.2008, which reduced the duty rate to 3%. The Commissioner (Appeals) allowed the reassessment, leading to the appeal by the Revenue. 3. The respondents relied on legal precedents such as MRF Ltd., State of Punjab v. Nestle India Ltd., and Kamani Oil to argue that the delay in issuing the corresponding customs notification revising the duty rate should not impose duty liability on them. They emphasized that the customs authority should not question the benefits granted by the government through the Directorate General of Foreign Trade (DGFT) under the Import Policy. 4. The Tribunal analyzed the situation and noted the discrepancy between the DGFT notification reducing the duty rate to 3% and the delayed customs notification implementing the change. Citing the principle of promissory estoppel, the Tribunal highlighted the importance of coordination between different government authorities to avoid confusion and ensure timely implementation of policy changes. The failure of the customs authorities to issue the notification on time was not held against the respondents, leading to the dismissal of the Revenue's appeal. 5. Ultimately, the Tribunal found no merit in the Revenue's appeal and upheld the Commissioner (Appeals) decision to allow reassessment of the Bills of Entry at the reduced duty rate of 3%. The judgment emphasized the need for coherence and synchronization between different government departments when implementing changes in duty rates to prevent undue hardship on taxpayers.
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