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TMI Blog2015 (12) TMI 1094X X X X Extracts X X X X X X X X Extracts X X X X ..... Deputy Commissioner of Central Excise and Customs, Kakinada Division had confirmed the liability of payment of interest of ₹ 6,96,558/- (Rupees Six Lakhs Ninety Six Thousand Five Hundred and Fifty Eight only) against the respondent namely M/s. Ruchi Soya Industries Ltd. along with imposition of penalty of ₹ 10,000/- (Rupees Ten Thousand only). This order of original adjudicating authority was reversed by the impugned order passed by Commissioner (Appeals), Visakhapatnam. 4. The department/Commissioner of Customs, Visakhapatnam has filed this appeal against their Commissioner (Appeals)-order whereunder the demand of interest and the imposition of penalty against the respondent was not found sustainable in law. 5. Briefly the facts are that the respondents had filed bill of entry on 20.11.2000and the bill of entry was assessed on the same day; but the vessel was granted entry in the port only on 21.11.2000 and on the said date i.e. on 21.11.2000 the duty on the subject goods was revised vide the Notification No. 142/2000-Cus. dated 21.11.2000 and 144/2000-Cus. dated 21.11.2000. The appellant (department) argues that as per Section 15 of the Customs Act the relevant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y of ₹ 10,000/- (Rupees Ten Thousand only) for this delay in payment of differential duty and for non-payment of interest in violation of the provisions of Section 47 of the Customs Act citing the provisions of Section 117 of the Customs Act. 10. The department has cited CESTAT Delhi decision in the case of Ajanta Tubes Ltd. Vs. CCE, Meerut-II [2007 (207) E.L.T 97 (Tri. -Del.)] saying that statutory interest is always attracted and it is automatically payable wherever there is a delay in payment of duty. It is pointed out that the case law quoted namely Ajanta Tubes Ltd. Vs. CCE, Meerut-II (supra) by the department is in respect of the facts of central excise but the ratio of the decision regarding liability of interest, wherever there has been delay in payment of duties to the national exchequer would be applicable to the facts of the present case also. 11. This is a case where the respondents have deliberately delayed the payment of differential duty of customs though it was payable to the national exchequer immediately i.e. as soon as the goods were released for home consumption. When the respondents knowingly and deliberately delayed the payment of differential duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s were accordingly cleared by the respondents. 16. Subsequently, a letter was issued to the importer on 24.11.2000 and they were directed to pay the differential duty amounting to ₹ 1,02,84,944/-. As the respondent did not deposit the said amount during the intervening period, the duplicate copy of the Bill of Entry was endorsed referring to increase of Customs duty from 35% to 65% and quantifying the duty on the said account as also on the excess discharged cargo amounting to ₹ 1,02,84,944/-, on 12.3.2001. The respondents, in fact, admitted their excess duty liability and accordingly, wrote to the department that they would be depositing the same. In fact, they made part payment of ₹ 25 lakhs during the first week of December 2000 itself which was rejected by the Revenue on the ground that they should pay the entire duty in one go as there is no provision for part payment of duty under the Customs Act. Ultimately, the total differential duty of ₹ 1,02,84,944/- was paid by the respondents on 10.3.2001. 17. The dispute in the present appeal relates to payment of interest and imposition of penalty upon the respondents. They were issued a show-cause notic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is returned to him for payment of duty, he shall pay interest at [such rate, not below [ten per cent] and not exceeding thirty six per cent per annum, as is for the time being fixed by the Central Government, by notification in the Official Gazette], on such duty till the date of payment of said duty. As is clear from the reading of the above provisions, sub-section (2) of Section 47 provides for interest in those cases where importer has not paid the import duty assessed in terms of sub-section (1) of Section 47 within a period of 2 days from the date on which the assessed Bill of Entry is returned to him for payment of duty. In the present case, the respondent has admittedly paid the duty within a period of 2 days from the date of assessed Bill of Entry and there is no dispute about the same. I find no justifiable reason to confirm the interest against the importer for alleged contravention of Section 47. 21. The Commissioner (Appeals) while dealing with the said plea of the assessee has accepted the same by observing as under : 9. It is to be seen that the present case the subject Bill of Entry was admittedly finally assessed to duty at ₹ 1,62,40,718/- and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 17(4) and Section 47(2) of the Act are mutually exclusive to each other. The provisions of Section 47(2) cannot possibly be involved in all cases of re-assessment under Section 17(4) ibid. To my mind, the provisions of Section 47(2) would be attracted only in those cases of reassessment wherein the imported goods are still in Customs charge and out of charge' order has not yet been given and also where the reassessed Bill of Entry has been returned to the importer for payment of reassessed duty and the importer has failed to pay the reassessed duty within the prescribed time limit of 2 days from the date of return of such Bill of Entry. Once, the goods are finally assessed to duty and the duty so assessed has been paid by the importer and out of charge' order under Section 47(1) ibid, has been given by the proper officer, there is no room for reassessing the Bill of Entry under Section 17(4) and recover interest by alleging contravention of Section 47(2). Of course, any short levy or short payment of duty or interest etc. can be recovered in the manner prescribed under Section 28 of the Act. On going through the above discussion and the interpretation of Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... could be sustained only under Section 28(1) of the Act. 17. It may be appreciated that the only provision, under which interest on delayed payment of duty could be demanded, is under Section 28AA or Section 28AB of the Act. Interest under Section 28AA could possibly be recovered if there was any delay of more than 3 months in payment of duty short levied / short paid etc. from the date of a formal order under Section 28(2) determining there under the duty short levied / short paid etc. It is an undisputed fact that no demand of differential duty under Section 28(1) was ever issued to the appellants and also no formal order under Section 28(2) of the Act determining the liability of differential duty was ever passed by the competent authority. Hence, no question arises for recovery of interest under Section 28AA. Similarly, the provisions of Section 28AB could be made use of only in the cases of short levy / short payment etc. resulted by reasons of collusion, fraud, willful mis-statement or suppression of facts etc. These elements were not alleged in the present case. Hence, the provisions of Section 28AB also had no application on the relevant date. It is needless to mention ..... X X X X Extracts X X X X X X X X Extracts X X X X
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