Commissioner Of Customs,Calcutta & ... vs Biecco Lawrie Ltd

2. Respondent-assessee (hereinafter referred to as respondent) imported 5273.156 M.T. of Superior Kerosene Oil (hereinafter referred to as SKO) on 15th of May, 1998. At that time, the duty payable on importation of SKO was only the countervailing duty of 10% ad valorem. The imported quantity of SKO was stored in a private warehouse of M/s. IBP Ltd. at Budge Budge at the port under the Bill of Entry No. 302(OIL).

3. On 20th May, 1998, respondent filed Ex bond bill of Entry (to get them de-bonded) for home consumption for a quantity of 5140 M.T. The full amount of duty was paid thereon amounting to Rs.35,75,836/-. The proper officer endorsed on the reverse of the Bills of Entry to the effect that the goods may be released by the Officer-in-charge of the warehouse. The Officer-in-charge, in turn, released the goods and made an endorsement to this effect on the reverse of the Bill of Entry.

4. Ex Bond bill of Entry for home consumption for quantity of 133.156 M.T. was filed on 28th May, 1998. The full amount of duty was paid thereon amounting to Rs.92,635/-. The proper officer endorsed on the reverse of the Bill of Entry to the effect that the goods may be released by the officer- in-charge of the warehouse. The officer-in-charge, in turn, released the goods and made an endorsement to this effect on the reverse of the Bill of Entry.

5. In view of the fact that SKO is a highly combustible material and cannot be taken out of storage tank to store elsewhere, the respondent made an application to the Assistant Commissioner of Customs, under Section 49 of the Act, requesting him to permit storage of goods, which had been cleared for home consumption, in the same warehouse/tank.

6. It may be mentioned here that the respondent had obtained a registration certificate from the concerned Central Excise Authorities under Rule 174 of the Central Excise Rules (for short, the Rules) in order to sell SKO to dealers/customers who required an invoice for Modvat purposes. In the said registration certificate, it was clearly mentioned that SKO would be stored by the respondent in IBPs storage tank at Budge Budge. The respondent had also subsisting contract with IBP Company Ltd., the owners of the storage tank for storage of SKO belonging to the respondent in the said tanks. The respondent had paid hire charges for the said tank to IBP under the agreement dated 22nd of October, 1997 which was further extended by an agreement dated 7th of July, 1998.

7. According to the respondent, with effect from 28th of May, 1998, upon clearance of the material for home consumption, the appellant stopped levying, Preventive Officer Charge (P.O. Charge), which is collected for supervision of the goods in warehouse, so long as they remain under the control of Preventive Officer of Customs. That, after the duty was paid, the control over the goods was lifted and no such charge was thereafter collected. Respondent, thereafter, started lifting goods from the storage tank from time to time in accordance with the requirements of its customers. During the period 28th of May, 1998 to 1st of June, 1998, the respondent lifted a quantity of 463.31 M.T. of SKO from the storage tank.

8. In the Budget for the year 1998-99, Basic Customs Duty and Special Customs Duty was levied on SKO @ 30% and 2% ad valorem respectively. Thereafter, the Customs Authority (the appellant hereinafter) withheld the clearance of SKO from the said tank on the contention that the respondent was required to pay Basic and Special Customs Duty @ 30% and 2% ad valorem and accordingly, wrote a letter to the respondent on 18th of June, 1998 contending that the differential duty would be payable on SKO not physically lifted before 2nd of June, 1998. Keeping in view the fact that lifting of goods was stopped by the Customs Authorities, the respondent deposited under protest an amount of Rs.24,48,822/- towards Basic and Special Customs Duty on 1000 M.T. of SKO under the Customs Receipt No. 1-1631 dated 25th of June, 1998. The respondent made a further deposit under protest of Rs.12,78,116/- towards Basic and Special Customs Duty on the quantity of SKO lifted between 2nd of June, 1998 and 6th of June, 1998.

11. After the passing of the order by the Tribunal, respondent filed a miscellaneous application before the Tribunal praying for a direction upon Customs Authorities to refund the amount deposited. Tribunal by its order dated 1st of November, 2002 directed the Revenue Authorities to refund the amount of duty inter alia in order to avoid uncalled for interest liability on the public exchequer. In terms of the orders passed by the Tribunal, a sum of Rs.99,89,938/- which was deposited under protest by the respondent, was refunded to it. Respondent, thereafter, filed an application before the Customs Authorities seeking payment of interest in terms of Section 27A of the Act on the aforesaid amount for the period during which the said sums were lying deposited with the appellant. The claim of the respondent on this account was for the sum of Rs.61,97,886/-. As the appellant had, in the meanwhile, filed an appeal in this Court, the appellant vide communication dated 15th of January, 2004 informed the respondent that the claim cannot be considered due to pendency of the matter in this Court.

22. For the reasons stated above, we do not find any merit in these appeals and dismiss the same leaving the parties to bear their own costs.

23. The Customs Authorities now may proceed to decide the application filed by the respondent for interest on the delayed payment in accordance with law.