9911796707
TMI Blog1991 (5) TMI 99X X X X Extracts X X X X X X X X Extracts X X X X ..... ls in bonded warehouses has been that the duty is paid whenever the goods are released from the warehouses. Accordingly, the duty payable on these would be allowable only at the time of the actual receipt of the goods. Thus, the value of the goods shown in the stock would be shown as inclusive of the customs duty. However, a reference to the balance sheet shows that only the CIF value of the bonded goods @ Rs. 27,52,950 has been included in the value of the stock-in-trade. It does not include the amount of customs duty payable. Even if the appellant's claim be admitted that the customs duty on the bonded goods is deductible, then this customs duty would have to be added to the value of the bonded goods shown in the stock-in-trade and, to this extent, the appellant's income would go up. The net result would be that the appellant's income would increase by the amount of the customs duty payable and the same amount would be allowed as a deduction resulting in no advantage to the appellant. In any event, in the absence of any orders of the customs authorities, levying duty on the bonded goods, the appellant's claim that deduction of the duty payable should be allowed, is not tenable as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntry inwards." 15. Thereafter, the learned counsel for the assessee invited our attention to two decisions of the Hon'ble Bombay High Court in the cases of Synthetics Chemicals Ltd. v. S.C. Coutinho 1981 ELT 414 and Apar (P.) Ltd. v. Union of India [1985] 22 ELT 644 (FB) wherein the Hon'ble High Court had construed the expressions " import " and " imported into India " to mean that import can be said to take place as soon as the goods are brought into the territorial waters of India. In other words, the taxable event occurs when, as laid down by section 12 of the Customs Act goods are imported into India. Since " India " includes its territorial waters, the taxable event occurs no sooner than the goods enter the territorial waters of India and does not get postponed till they are actually off-loaded on the land mass or till the goods are valued under section 14 or till the date for determining the rate at which customs duty should be levied under section 15 arrives. In this view of the matter, the learned counsel for the assessee submitted that the assessee ought to have been allowed deduction in respect of the customs duty payable in view of the decision of the Hon'ble Suprem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fied his action. He strongly urged that the assessee's claim for deduction of larger amount that Rs. 22,56,273 should not be allowed at this stage, as both before the IT authorities as well as in the memo of appeal filed before the Tribunal, the assessee had claimed deduction of Rs. 22,56,273 only. He also pointed out that so far, the assessee was following the method of accounting customs duty in the accounts only at the time of clearance of the goods from the Bonded Warehouse as could be seen from the Notes appended to the revised return (reproduced above). He, therefore, strongly submitted that the assessee should not be allowed to change the method of accounting consistently followed by it merely on the basis of the aforesaid two decisions of the Hon'ble Bombay High Court referred to and relied upon by it. According to the learned representative for the department, since the revised rates of the customs duty were, brought into effect from 15-2-1982, i.e., after the end of the relevant previous year (which ended on 30-9-1981), the assessee would not be entitled to deduction of amount, if any, higher than Rs. 22,56,273. He also referred to various reported decisions relied on beh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the territorial waters of India. To this extent we would accept the submissions made on behalf of the assessee. 19. In our considered opinion, the assessee would not be entitled to deduction of customs duty at the rate of 300% for more than one reasons. Firstly, the claim for deduction at higher rate was not made before the ITO or the CIT(A). Even before the Tribunal, the assessee had not taken up an additional ground in this regard. The learned counsel for the assessee simply stated that since the customs duty on the goods imported were revised upwardly from 15-4-1982, the assessee should be allowed deduction of a larger amount than that claimed before the IT authorities. In our view, the decision in the case of Madras Industrial Investment Corpn. Ltd. would not be of much help to the assessee, as in the instant case the deduction claimed at a higher amount was not a pure question of law and the exact quantification of the liability cannot be arrived at without investigation of facts. It is pertinent to note that in the court of law the assessee has challenged the very imposition of the customs duty on the goods dealt by it and not that it was not liable to be taxed at higher ..... X X X X Extracts X X X X X X X X Extracts X X X X
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