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TMI Blog2024 (6) TMI 1334X X X X Extracts X X X X X X X X Extracts X X X X ..... s of Entry. The provisions of Section 46 (5) of the Act are applicable in a case where Ex-Bond Bill of Entry, Into Bond Bill of Entry or vice versa, can be permitted if there is no revenue loss or there is no fraudulent intention - it is a fit case for consideration of the request made by the appellant on 08.10.2021 in the light of the provisions of Section 46 (5) of the Act. Admittedly, on 08.10.2021, there is no change of rate of duty and till three months, in terms of Section 61 (2) of the Act, the appellant is not required to pay any interest. Admittedly, for clearance of goods under Section 68 of the Act, the provisions of Section 47 (2) are not attracted. We hold that the provisions of Section 47 of the Act, are not applicable in the present case as the appellant has initially filed in to Bond Bills of Entry for warehousing. Section 68 of the Act is applicable in this case. As after filing Ex-Bond Bill of Entry on 21.09.2021 28.09.2021, the condition of Section 68 of the Act, were not satisfied and as no assessment was done for clearance of goods in question, therefore, the application dated 08.10.2021 is required to be disposed off - Admittedly, on 08.10.2021, there is no ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellation of the Ex-Bond BOEs and reinstatement of Into-Bond BOEs in light of the ensuing festive season due to which the production and sales would remain depressed with manpower shortage and stretched finances. 20.10.2021 & 25.10.2021 :- Reminder letters with respect to the above were addressed to the Ld. Principal Commissioner of Customs (Port). 13.10.2021 :- Notification No. 48/2021 - Customs and Notification No. 49/2021 - Customs were issued, whereby the Basic Customs Duty ("BCD") and Agricultural Infrastructure and Development Cess ("AIDC") on the subject goods were reduced from 2.5% to "Nil" and 20% to 7.5% respectively with effect from 14 October 2021. 27.10.2021 :- The Ld. Assistant Commissioner of Customs, Appraising Group rejected the request of withdrawal/cancellation of the Ex-Bond BOEs on the ground that the reasons mentioned in the Application dated 08 October 2021 were inadequate. 01.11.2021 :- The Appellant furnished detailed justification with respect to its request for cancellation/withdrawal of the Ex-Bond BOE and continuation of the Into-Bond BOE duly supported by the Warehousing provisions and a CA Certificate endorsing the depressed production and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said matter. 10.03.2022 :- Two letters of even date were filed for release of the Warehouse goods along with a Manual Bill of Entry for home consumption by assessing the customs duties to the tune of Rs.20,26,59,739/- and a Draft of Rs.1,02,20,754/- towards the payment of interest for the period from 18 January 2022 to 10 March 2022, basis which the warehouse goods were released. 19.04.2022 :- The Appellant vide its letter dated 19 April 2022 furnished a break-up of sum of Rs.23.91 Crores (duty-wise split) along with the amount of refund of Rs.3.64 Crores to which the Appellant would be entitled to if its application for cancellation/substitution of the Ex-Bond BOE was allowed. 08.09.2022 :- The Ld. Adjudicating Authority passed Order No. KOL/CUS/AC/GR. I/PORT/45/2022 once again rejecting the application of the Appellant for cancellation of the Ex-Bond BOEs and re-instatement of the Into- Bond BOE, interalia holding that the same is not covered by Section 46(5) or under any other express provision of the statute. 28.07.2023 :- The Ld. Appellate Commissioner passed the Impugned Order in Appeal bearing No. KOL/CUS/PORT/KS/572/2023 reiterating the grounds and contentions o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urther submits that cancellation/withdrawal of a BOE is allowed in terms of serial no.4 of the Standing Order No.16/2020 dated 16 June 2020 which lays down the SOP for Deletion or Cancellation of Bill of Entry in the system. 3.6 He further submits that in any event, cancellation/withdrawal of BOE has not been specifically prohibited under the provisions of the Customs Act. It is a settled principle in law that every procedure is to be understood as permissible till it is shown to be prohibited. [Rajendra Prasad Gupta Vs. Prakash Chandra Mishra-(2011) 2 SCC 705 (SC). 3.7 Again, he submits that in any event, the right to present/file the Ex-Bond BOEs include the right to cancel/withdraw the same in absence of any specific prohibition with respect to the same in terms of the provisions of Section 21 of General Clauses Act. 3.8 It is his further submission that the condition of the interest of the revenue not being prejudiced must be ascertained as on the date of the making the application i.e., 08 October 2021 when the notifications reducing the rate of duty were not in existence and not with reference to subsequent events. Had the application of the Appellant been allowed as on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ling of the manual BOEs i.e., the reduced rates in terms of the aforesaid notifications. 3.14 He, therefore, submits that non-permitting substitution would result in a situation whereby customs duty would be recovered from the Appellant, which is not otherwise payable when the Appellant had already reduced the prices of refined palm oil with effect from 14 October 2021. 3.15 Finally, he prays for setting aside the impugned order by allowing the Application of the Appellant for substitution of Ex-Bond BOEs with Into-Bond BOEs and as a consequential relief, refund the excess duties of Customs of Rs.3,64,79,723/- and interest thereon and cancellation of the Bank Guarantee of Rs.23,91,39,462/-. 4. The ld.A.R. for the Revenue has justified the impugned order and he has submitted that in view of the decision of the Hon'ble Bombay High Court in the case of Jain Irrigation Systems Vs. Commissioner of Customs, Nhava Sheva reported in 2005 (189) ELT 277 (Bom.), the reconversion of home consumption Bill of Entry into Into-Bond Bill of Entry, was denied by the Hon'ble Bombay High Court. Therefore, the Ex-Bond Bill of Entry cannot be converted into Into-Bond Bill of Entry. 5. Heard both the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al Gazette.] [Provided that the Central Government may, by notification in the Official Gazette, specify the class or classes of importers who shall pay such duty electronically : Provided further that] where the bill of entry is returned for payment of duty before the commencement of the Customs (Amendment) Act, 1991 and the importer has not paid such duty before such commencement, the date of return of such bill of entry to him shall be deemed to be the date of such commencement for the purpose of this section : ] [[Provided also that] if the Board is satisfied that it is necessary in the public interest so to do, it may, by order for reasons to be recorded, waive the whole or part of any interest payable under this section.] Section 61 (c) in the case of any other goods, till the expiry of one year from the date on which the proper officer has made an order under sub-section (1) of section 60 : Section 61 (2) Where any warehoused goods specified in clause (c) of sub-section (1) remain in a warehouse beyond a period of ninety days from the date on which the proper officer has made an order under sub-section (1) of section 60, interest shall be payable at such rate as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entry for home consumption is filed under Section 68 of the said Act, if the importer fails to pay the duty within 5 working days from the date on which such Bill of Entry filed under Section 68 is returned to him for payment of duty. 2. The matter has been examined by the Board. As per Section 46 of the Customs Act, 1962, the importer of any goods, other than goods intended for transit or transshipment, shall make entry thereof by presenting to the proper officer a bill of entry for home consumption or warehousing in the prescribed form. The provision regarding payment of interest for delayed payment of duty after the return of Bill of Entry is contained in Section 47 which reads as under : "(1) Where the proper officer is satisfied that any goods entered for home consumption are not prohibited goods and the importer has paid the import duty, if any, assessed thereon and any charges payable under this Act in respect of the same, the proper officer may make an order permitting clearance of the goods for home consumption. (2) Where the importer fails to pay the import duty under subsection (1) within five days excluding holidays from the date on which the bill of entry is r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the said period till the date of payment of duty on the warehoused goods. 7. In view of the foregoing, it is clarified that the provisions of Section 47(2) are not attracted in case of clearances made under Section 68. Consequently, no interest is liable to be paid on goods deposited in a warehouse and being cleared for home consumption by filing the Bill of Entry prescribed under Section 68 of the Act, ibid, for delayed payment of duty i.e. if the importer fails to pay the duty within 5 working days from the date on which such Bill of Entry is returned to him for payment of duty. However, interest on warehoused goods is payable when they remain in a warehouse beyond the period specified in sub-section (1) of Section 61 as per provisions of sub-section (2) of Section 61. 8. Wide publicity to this Circular may be given by way of issuance of public notice and standing order. 9. Difficulties, if any, faced in the implementation of this circular, may be immediately brought to the notice of the Board. 10. Please acknowledge receipt. 11. Hindi version follows." 8. In this case, the facts are not in dispute that initially, on 06.09.2021 & 20.09.2021, the appellant fil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ills of Entry. But he held that if the same is done, then there will be a substantial loss of revenue in terms of Section 46 (5) of the Customs Act, 1962. 8.3 We find that the Bill of Entry is to be filed under Section 46 of the Act and Section 46 (5) of the Act, provided that the proper officer may permit substitution of Bill of Entry for home consumption for a Bill of Entry for warehousing or vice versa if there is no loss of revenue and there should not be any fraudulent intention . 8.4 Section 68 of the Act provided for clearance of warehoused goods for home consumption that as per the said provision, the appellant was required to file Bill of Entry for home consumption in the prescribed form and to pay import duty, interest, fine and penalties payable in respect of such goods for home consumption and order for clearance of such goods is to be made by the proper officer. Further, the owner of the impugned goods, may, at any time, before an order for clearance of goods for home consumption has been made in respect of such goods, relinquish his title to the goods upon payment of penalties that may be payable in respect of the goods and upon such relinquishment, he shall not be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er there is a revenue loss to the Revenue or not ? 13. Admittedly, on 08.10.2021, there is no change of rate of duty and till three months, in terms of Section 61 (2) of the Act, the appellant is not required to pay any interest. 14. Therefore, we have to examine the issue in the light of the CBEC Circular dated 12th May, 2009 which prescribed that in case of goods deposited in a warehouse and being cleared for home consumption, the following conditions are to be satisfied : "(a) a bill of entry for home consumption in respect of such goods has been presented in the prescribed form; (b) the import duty leviable on such goods and all penalties, rent, interest and other charges payable in respect of such goods have been paid; and (c) an order for clearance of such goods for home consumption has been made by the proper officer. 5. Section 68 is a self-contained provision dealing with the clearance of goods from a warehouse for home consumption and this provision does not contain a reference to payment of interest on delayed payment of duty after return of Bill of Entry." 15. Admittedly, for clearance of goods under Section 68 of the Act, the provisions of Section 47 (2) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Pvt Ltd v. Union of India - 1991 (51) E.L.T. 185, relied upon by the appellant also followed in a latter judgment in Kuil Fireworks Industries v. CCE - 1997 (95) E.L.T. 3 would apply. We reproduce below paragraph 2 of this judgment : "Had the customs authorities passed order in accordance with law the same result would have followed as had been done on December 17, 1987 ... There is no valid reason as to why the same procedure should not have been followed in respect of the remaining goods in respect of which the bills of entry were filed on January 28, 1988 for debonding and clearance of goods. Merely because the officer failed to discharge his duties by making illegal demand for deposit of redemption fine, the appellant could not be held liable to pay duty. The appellant is therefore entitled to the delivery of goods without paying any duty as on January 28, 1988 no duty was payable on the goods." 18. In view of the above observations, it is concluded that the application for withdrawal/cancellation of Ex-Bond Bill of Entry and reinstatement of Into-Bond Bill of Entry, was required to be considered by the authorities below in terms of Section 46 ( 5) of the Act immediately ..... X X X X Extracts X X X X X X X X Extracts X X X X
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