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2019 (10) TMI 547 - AT - CustomsDemand of short paid duty due to changes in rate of duty - Gold - enhancement of duty - HELD THAT - The appellant filed the Bill of Entry on 21.01.2013 and paid the Customs Duty @4% as per the demand by the Customs Department. Further we find that the goods were cleared at 5.40 pm on the same day. We also find that on the same day Notification 01/2013 dated 21.01.2013 was issued enhancing the rate of duty from 4% to 6% but the said Notification was not published in the Gazette of India and in fact it was published on 01.02.2013 and thereafter offered to public for sale on 04.02.2013. Further we note that as per Section 25(1) of the Act, the said Notification would come into force only on 04.02.2013 when it was offered for sale to the public. On 21.01.2013 when the goods were cleared, the rate of Customs duty was 4% as per the unamended Notification 12/2012 dated 17.03.2012 and the appellant has correctly paid the Customs duty on the said goods. Appeal allowed - decided in favor of appellant.
Issues:
- Confirmation of demand of short paid duty under Section 28(4) of the Customs Act - Applicability of enhanced rate of duty under Notification No. 01/2013 - Legal interpretation of Section 25(1) of the Customs Act Confirmation of demand of short paid duty under Section 28(4) of the Customs Act: The appeal was against an order confirming a demand of short paid duty of &8377; 1,23,37,546/- along with interest and penalty. The appellant, a bank authorized to import gold, imported 200 kgs of gold valued at &8377; 59,98,24,940/- and paid Customs duty @ 4%. The demand arose due to an alleged differential duty under Notification No. 01/2013 issued on the same day as the import. The Principal Commissioner confirmed the demand, leading to the appeal. Applicability of enhanced rate of duty under Notification No. 01/2013: The appellant argued that the rate of Customs duty applicable at the time of filing the Bill of Entry was 4%, as the enhanced rate of 6% under Notification No. 01/2013 was not published or known to the public. The appellant contended that the Notification could not be made applicable to goods imported before being offered for sale to the public, as per Section 25(1) of the Customs Act. Citing legal precedents, the appellant asserted that the Notification's effectiveness begins only after being offered for sale to the public. Legal interpretation of Section 25(1) of the Customs Act: The Tribunal examined the timing of the Notification's publication and its impact on the rate of duty applicable to the imported goods. It noted that the Notification enhancing the duty from 4% to 6% was not published until after the goods were cleared. Relying on legal precedents, including decisions by the Hon'ble Apex Court and the Hon'ble High Court of Gujarat, the Tribunal concluded that the Notification's effectiveness begins only after being offered for sale to the public. The Tribunal found that the appellant correctly paid the Customs duty at the rate applicable when the goods were cleared, i.e., 4%, and set aside the impugned order, allowing the appeal in favor of the appellant. Conclusion: The Tribunal, after considering submissions from both parties and legal precedents, concluded that the impugned order confirming the demand of short paid duty was not sustainable in law. By following the legal interpretations provided by the Hon'ble Apex Court and the Hon'ble High Court of Gujarat, the Tribunal set aside the order and allowed the appeal of the appellant with consequential relief, if any.
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