Back
1988 Supreme(Cal) 305
High Court Of Calcutta
Ajit K. Sengupta
DINESH KUMAR NEVATIA - Appellant
Versus
COLLECTOR OF CUSTOMS - Respondent
Matter 382 Of 1987
Decided On : 07/27/1988
Importation of goods is complete when the goods enter the territorial waters of India, and not when the Bill of Entry is presented or the goods are cleared for home consumption.
Headnote:
CUSTOMS ACT - IMPORTATION OF GOODS - LEVY OF DUTY - TIME OF IMPORTATION - "INDIA" INCLUDES TERRITORIAL WATERS - IMPORTATION COMPLETE WHEN GOODS ENTER TERRITORIAL WATERS - DUTY LEVIABLE FROM THAT DATE - NOTIFICATION EXEMPTING GOODS FROM DUTY - WITHDRAWAL BEFORE CLEARANCE - GOODS NOT CHARGEABLE TO DUTY.
Fact of the Case:
The petitioner purchased 252 Metric Tons of Dun Peas which arrived at the Port of Calcutta on or about 27th January, 1987 and discharge of the cargo was completed by 30th January, 1987. The vessel entered the territorial waters of India on 27th January, 1987. The said goods were OGL items and no Customs duty were payable. On 4th February, 1987, a notification was issued by the Customs Authorities being Notification No. 40/87 which has imposed 25% ad valorem duty on importation Dun Peas.
Finding of the Court:
The Court held that the goods became imported goods no sooner than they entered the territorial waters of India, which provisions would have been wholly redundant if goods become liable to Customs duty only at the time of clearance.
Issues: 1. When was the importation of subject goods complete? 2. Whether the subject goods imported by the petitioner are liable to any duty or not.
Ratio Decidendi: 1. The Court held that the importation of goods is complete when the goods enter the territorial waters of India, and not when the Bill of Entry is presented or the goods are cleared for home consumption. 2. The Court held that the goods in question were exempt from Customs duty on the date they were imported, and therefore the subsequent withdrawal of the exemption notification did not render them liable to duty.
Final Decision: The Court allowed the petitioner's application and directed the respondents to refund the Customs duty paid by the petitioner.
( 1 ) THE question which calls for determination in this case is when was the importation of subject goods complete. The answer to this question will determine whether the subject goods imported by the petitioner are liable to any duty or not.
( 2 ) THE facts of this case shortly stated are that the petitioner purchased 252 Metric Tons of Dun Peas which arrived at the Port of Calcutta on board M. V. Peters if on or about 27th January, 1987 and discharge of the cargo was completed by 30th January, 1987. The vessel entered the territorial waters of India on 27th January, 1987. The said goods were OGL items and no Customs duty were payable. The said vessel contained similar other goods. On 4th February, 1987, a notification was issued by the Customs Authorities being Notification No. 40/87 which has imposed 25% ad valorem duty on importation Dun Peas.
( 3 ) SINCE the said goods were OGL items and no Customs duty was payable before the said notification came into force, the question is whether the goods have been imported prior to 4th February, 1987 i. e. before the said Notification No. 40/87, dated 4th February, 1987 came into effect imposing a duty ad valorem. According to the petitioner notification came into force after the goods had entered into the territorial waters of India on 27th January, 1987 and the goods were unloaded on 29th January, 1987 and he presented the bill of entry on 3rd February, 1987.
( 4 ) IT is the contention of the respondents that for the purpose of fixing the rate of duty, the date of importation is not relevant. What is relevant is as provided Under Section 15 of the Customs Act, 1962. Section 15 fixes (i) the date and (ii) the rate from and at which the duty is to be imposed. From Section 15, it is clear that the date of importation is not mentioned therein. in the present case, the relevant date is the date when the Bill of Entry has been filed for home consumption with the Department. The petitioner presented the Bill of Entry on 5th February, 1987 when the same was assessed to duty on the said date on the basis of the said Notification No. 40/87, dated 4th February, 1987. It is, therefore contended by the respondents that in the circumstances the petitioner is liable to pay duty as per the said Notification No. 40/87, dated 4th February, 1987.
( 5 ) THE Customs duty is leviable on the importation of the goods. Accordingly relevant consideration is when was the importation complete. If the importation was completed on 27th January, 1987 when the vessel had entered the territorial waters of India, in that event no duty in terms of the notification dated 4th February, 1987 would be payable by the petitioner. If however the importation takes place when the Bill of Entry is assessed the duty may have to be levied on the basis of such notification. The question came up before the Full Bench of the Bombay High Court in the case of Apar Private Ltd. v. Union of India and Ors.
( 6 ) IN that case on the date when the goods in question entered into the territorial waters of India, they were exempted from payment of Customs duty under the relevant notification issued by the Central Government. While the goods were sought to be removed from the Bonded warehouse, exemption earlier granted were withdrawn. The question arose when were the goods imported in India. There was a difference of opinion between the two Division Benches and accordingly the matter was referred to Full Bench. The following questions were referred to the Full Bench. (1) Under the Customs Act, 1962 when can the event of importation be said to occur? (2) At what point of time or date the rate of Customs duty to which imported goods are liable was to be determined under the Customs Act, 1962 ? (3) Whether it would make any difference to the answer to the second question in cases where at the date of import the goods were totally exempt from duty, either basic or additional as against being partially exempt from suc
