1992 (5) TMI 26 - HC - Customs

Summary

Issues Involved:
1. Applicability of the rate of customs duty.
2. Validity and enforceability of the notifications.
3. Determination of the effective date of the notifications.
4. Refund of excess customs duty paid.

Detailed Analysis:

1. Applicability of the Rate of Customs Duty:
The main issue was whether the rate of customs duty applicable to the generating set imported by the petitioner should be 30% basic plus 30% auxiliary (total 60%) as per Notifications Nos. 59/89 and 144/90, or 35% basic plus 50% auxiliary (total 85%) as per subsequent Notifications Nos. 296/90 and 287/90. The petitioner argued that the former rates should apply since the latter notifications were not published until January 1991, although dated 18-12-1990 and 15-12-1990.

2. Validity and Enforceability of the Notifications:
The petitioner contended that the notifications dated 18-12-1990 and 15-12-1990 were not validly enforceable on the date of the vessel's arrival (18-12-1990) because they were published in the Gazette only in January 1991. The respondents argued that the notifications became effective on the date they were issued, regardless of the publication date.

3. Determination of the Effective Date of the Notifications:
The court examined whether the effective date of the notifications should be the date they were issued or the date they were published and made available to the public. The petitioner relied on Section 15 of the Customs Act, 1962, which determines the rate of duty based on the date of the bill of entry or the date of entry inwards of the vessel. The court also considered precedents, including the principle that a notification becomes effective only when it is made known to the public (AIR 1990 Cal. 52, AIR 1963 SC 895, and AIR 1951 SC 467).

4. Refund of Excess Customs Duty Paid:
The petitioner sought a refund of Rs. 73,22,500/-, arguing that this amount was paid in excess due to the provisional assessment based on the higher duty rates. The court agreed with the petitioner, holding that the duty payable should be 60% (30% basic and 30% auxiliary) and not 85% (35% basic and 50% auxiliary).

Conclusion:
The court concluded that the notifications dated 18-12-1990 and 15-12-1990 were applicable only from the date of their publication in January 1991. Therefore, the rate of duty applicable to the generating set imported by the petitioner was 60% (30% basic and 30% auxiliary). The court ordered the respondents to refund the excess amount of Rs. 73,22,500/- within six weeks, without any interest, considering the special facts and circumstances of the case. The petition succeeded, and the rule was made absolute. The court rejected the respondents' request for a stay of the order.