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2023 (6) TMI 1260 - HC - CustomsLevy of interest during the period of protection granted by the High Court - Imposition of safeguard duties - imports of Aluminum Foil - I nterim order was being passed by the Court with effect from 19th August 2009, an amendment came to be incorporated to the provisions of Section 8C of the Act by insertion of Sub-section (5A) by Finance No. 2 Act, 2009 with retrospective effect - The protection was vacated as on 11.6.2010 - HELD THAT - It is not in dispute that the proceedings have remained pending as they stood on 11th June 2010, that is when the Court passed the modified interim order. Never an application was made by the Respondents after 11th June 2010 for vacating of the said orders. The Bank Guarantee as furnished by the Petitioner in pursuance of the order dated 11th June 2010 passed by the Court, has continued to remain with the Respondents, the validity of which has been extended from time to time. The bond as furnished by the Petitioner also has continued to remain valid. Almost about 13 years having lapsed after the order dated 11th June 2010, the Respondents are yet to pass a final assessment order. However in the intervening period there was a self-assessment as made by the Petitioner in the year 2017, in pursuance of which the Petitioner deposited duty amounting to Rs. 97,44,034/-. When the interim protection granted to the Petitioner continuous to operate the only apprehension of the Petitioner, today is that although the Respondents may take forward the matter to pass a final assessment order, however, in the peculiar facts and circumstances of the case and more particularly in view of the interim order passed by this Court dated 8th May 2009, as modified by order dated 11th June 2010, in the final assessment order which may be passed, the Petitioners ought not to be subjected to the levy/payment of interest. Such apprehension of the Petitioner is in the light of the letter of Assistant Commissioner (H) dated 28th March 2017, addressed to the Petitioner a copy of which has been placed on record. This is certainly not a case where the Petitioner ought to be foisted with interest under Section 28AA of the Customs Act as made applicable by Sub-section 5A of Section 8C of the Customs Tariff Act. It may be observed that the Respondents also, were in no manner aggrieved by the self-assessment as undertaken by the Petitioner under which duty was paid - the Respondents are directed to proceed to pass a final assessment order, however, without levy of any interest on the assessment which may be arrived. Application disposed off.
Issues Involved:
1. Legality and validity of Customs Notification No. 26/2009 and Preliminary Findings dated 02.02.2009. 2. Absence of rules for assessment and collection of safeguard duty under Section 8C of the Customs Tariff Act, 1975. 3. Interim relief and protection of revenue. 4. Applicability of interest under Section 28AA of the Customs Act. Summary: Issue 1: Legality and Validity of Customs Notification No. 26/2009 and Preliminary Findings dated 02.02.2009 The petitioner challenged the Customs Notification No. 26/2009 dated 23.03.2009 and Preliminary Findings dated 02.02.2009 under Article 226 of the Constitution of India, seeking to quash and set aside the impugned notification and findings. The petitioner contended that no rules were framed by the respondents as required under Sub-section 6 of Section 8C of the Customs Tariff Act, 1975. Issue 2: Absence of Rules for Assessment and Collection of Safeguard Duty The petitioner argued that in the absence of rules for assessment and collection of safeguard duty, the authorities under the Customs Act had no jurisdiction to collect such duties. The court noted that Section 8C(6) of the Customs Tariff Act allowed the Central Government to make rules for the assessment and collection of safeguard duty, but such rules were not made, rendering the provisions for assessment and collection of duty otiose. Issue 3: Interim Relief and Protection of Revenue An interim relief was granted by the court on 8th May 2009, allowing the petitioner to import goods covered by the Notification, subject to furnishing a bond without a bank guarantee. The interim order was modified on 11th June 2010, directing the petitioner to furnish a bank guarantee to the extent of 50% of the amount covered by the bond. The court observed that the respondents did not pass a final assessment order for almost 13 years and did not move the court for permission to pass such an order. Issue 4: Applicability of Interest under Section 28AA of the Customs Act The petitioner apprehended that they might be subjected to the levy/payment of interest under Section 28AA of the Customs Act in the final assessment order. The court held that the petitioner should not be foisted with interest under Section 28AA, as the interim orders never precluded the respondents from approaching the court to finalize the assessment. The court directed the respondents to pass a final assessment order without levying any interest and to release the bank guarantee within six weeks. Conclusion: The court disposed of the writ petition directing the respondents to pass a final assessment order without levying any interest and to release the bank guarantee furnished by the petitioner. All contentions of the petitioner on the assessment were expressly kept open.
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