2018 (9) TMI 1736 - HC - Customs

Refund of the excess Customs duty paid - finalization of the provisional assessment - excess duty collection arisen due to typographical error - Section 154 of the Customs Act, 1962 - Held that - Section 154 of the Customs Act, 1962 deals with the situation where there is a clerical or arithmetical mistakes, in any decision or errors arising therein, from any accidental slip or omission, at the time of assessing the Bill of Entry and same can be corrected by the proper officer - The assessing authority can amend an order of assessment, insofar as clerical slips/errors is concerned. On making of such correction under Section 154 of the Act, the consequential return of amount of duty of customs, would be available to an importer. In the present case, there was a error, on the part of the supplier, who has inadvertently charged SEK 199450 (Rs.11,36,865/-), whereas, the actual freight incurred was only SEK 19945 (Rs.1,13,686.50). Even the supplier has admitted the mistake and they have given a credit note, for the difference involved. Appraiser, who was present in the personal hearing, before the Original Authority, has shown that the split values appearing in the invoice, and admitted that there could have been a mistake in the assessment, due to the wrong figures given by the 1st respondent, and placing on record the above, the Commissioner (Appeals) has observed that excess amount of duty, has been collected, on account of wrong freight amount, being included in CIF value. Admittedly, even according to the Commissioner (Appeals), excess duty collection, has arisen due to typographical error, on the part of the supplier and that therefore, Section 154 of the Act, is applicable. Appeal dismissed - decided against Revenue.

Summary

Issues Involved:
1. Whether clerical errors committed by the importer on documents presented for clearance of import can be corrected under Section 154 of the Customs Act, 1962, by way of reassessment.
2. Whether the provisionally assessed Bill of Entry can be reassessed more than once by the competent authority for correcting a clerical error committed by the importer.

Issue-wise Detailed Analysis:

1. Clerical Errors and Reassessment under Section 154 of the Customs Act, 1962:

The case revolves around the correction of a clerical error in the freight amount declared by the importer, leading to excess duty payment. The importer, M/s. Volvo India Pvt. Ltd., sought correction of the error and refund of the excess duty paid. The lower authority denied permission, and the Commissioner (Appeals) held that the refund claim was premature as the provisional assessment had not been finalized. The CESTAT, however, allowed the appeal, stating that errors and accidental slips could be corrected under Section 154 of the Customs Act, 1962. This section allows for the correction of clerical or arithmetical mistakes or errors arising from accidental slips or omissions at any time. The Tribunal held that the right of an importer to seek amendments in the Bills of Entry under Section 149 of the Act was not altered by certain judgments of the apex Court. The Tribunal also noted that no legal provision barred seeking remedy by filing an appeal against a provisional assessment.

2. Reassessment of Provisionally Assessed Bill of Entry:

The Commissioner of Customs (Port-Imports) filed an appeal against the CESTAT's decision, raising substantial questions of law regarding the reassessment of provisionally assessed Bills of Entry. The court noted that Section 154 of the Customs Act, 1962, allows for corrections at any time, and therefore, the question of filing an appeal against the assessment order does not arise. The assessing authority can amend an order of assessment to correct clerical slips/errors, and upon making such corrections, the consequential return of the excess duty paid would be available to the importer. The court referenced several judgments, including Union of India v. Aluminium Industries Ltd. and Hero Cycles vs. Union of India, to support the view that clerical errors can be corrected, and the duty must be assessed in accordance with the law, even if it involves correcting an inadvertent error by the importer.

Conclusion:

The court concluded that there was no manifest illegality or irregularity in the CESTAT's order. The substantial questions of law were answered against the revenue, and the Civil Miscellaneous Appeal was dismissed. The court affirmed that Section 154 of the Customs Act, 1962, allows for corrections of clerical errors at any time, and the importer is entitled to a refund of the excess duty paid due to such errors, subject to the provisions of Section 27(2) of the Act, which prescribes the test of unjust enrichment.