2024 (11) TMI 1468 - AT - Customs

Applicable rate of tariff value - whether the tariff value applicable to the import of gold would be as per the Notification 39/2013 dated 17.04.2013 in respect of Bills of Entry (BEs) dated 26.04.2013 and Notification No. 55/2013 dated 21.05.2013 for Bill of Entry filed on 31.05.2013 or the revised tariff value as per Notification No. 50/2013 dated 26.04.2013 and Notification No. 57/2013 dated 31.05.2013 respectively would be applicable to these Bill of Entries? - HELD THAT - The Hon ble Karnataka High Court while examining the judgement dealing with the appeal filed by the Revenue in the case of M/s Param Industries Ltd. (M/s Param Industries Ltd. Vs Union of India 2002 (9) TMI 115 - HIGH COURT OF KARNATAKA where Hon ble High Court of Karnataka had interalia while deciding the applicability of notification held that the date of actual publication of the notification in the Gazette will be the date on which the effect of the such notification can be given. Essentially this judgment justifies that merely issuing of notification by the Government would not make it effective unless it is brought to the notice by way of publication through Government press in the official Gazette or by any other means and in this case admittedly the publication of the said 2 notifications have not taken place on the date of issue of the notification by the Department. In fact going by the Department s own stand itself Notification No. 50/2013 was published at a much later date on their website and though in the case of Notification No. 57/2013 it was published on the same day but it was uploaded on the website after 6 pm. Similar issue as to what will be the effective rate or tariff value when the Bill of Entries are filed and on the same day different notifications are available in the sense that one notification is prevailing while another is also issued on the same day by the Department has been dealt with by the Hon ble Supreme Court in the case of G.S. Chatha Rice Mills 2020 (9) TMI 903 - SUPREME COURT . As per the judgment essentially it would be the time of filing/assessment of Bill of Entry that would be relevant to decided as to which rate or tariff value would be applicable to the relevant Bill of Entry. It is now a settled law that a notification would be effective from the date of publication or when it is brought to the notice of people by way of offer for sale of notification/gazette or by way of any other means like uploading on Official Website etc. On all these parameters unless otherwise specifically indicated in the notification itself in exercise of relevant statutory power by the Competent Authority the existing/old notifications could be considered as effective on the date on which Bill of Entries were filed. Moreover this is a case of RMS clearance and self assessment where the system itself would have applied revised tariff Value which admittedly was not done in the present case. In fact the revised Tariff rate was available in system with effect from 01.06.2013 and that is why the present appellant finally had to pay revised rate for import on and after 01.06.2013 - there is no merit in Department s insistence on demanding duty as per the revised tariff rate in respect of these 3 Bill of Entries. Conclusion - The effective dates would be relying on ratio of Param Industries would be date of publishing of these notifications as discussed and thus on both these counts the amended Notification No. 50/2013 57/2013 would not be applicable to Bill of Entries (Bes) filed on 26.05.2013 and 31.05.2013 respectively. The order dated 17.12.2019 of the Original Adjudicating Authority confirming the demand against the appellant is not sustainable and therefore is set aside - appeal allowed.

Summary

The core legal questions considered in this judgment are:

1. Whether the revised tariff values notified by the Government through Notification No. 50/2013 dated 26.04.2013 and Notification No. 57/2013 dated 31.05.2013 were applicable to the appellant's import consignments for which Bills of Entry were filed on 26.04.2013 and 31.05.2013 respectively.

2. Whether the effective date of a tariff notification under the Customs Act is the date of issuance of the notification or the date of its publication in the Official Gazette or its availability to the public through other official means.

3. The relevance of timing of filing of Bills of Entry vis-`a-vis the timing of publication or uploading of the notifications on official platforms in determining the applicable tariff value.

4. Whether the appellant's self-assessment of customs duty based on the tariff values prevailing at the time of filing the Bills of Entry was correct and legally sustainable.

5. The legal effect of delayed publication or non-availability of notifications on the date of filing of Bills of Entry on the applicability of revised tariff values.

Issue-wise Detailed Analysis:

Issue 1 & 2: Applicability and Effective Date of Tariff Notifications

The legal framework revolves around Section 14 and Section 17 of the Customs Act 1962, which govern valuation and self-assessment of customs duty respectively, and the requirement that tariff notifications under Section 8A of the Customs Tariff Act must be published to be effective. The appellant imported gold bars and filed Bills of Entry on 26.04.2013 and 31.05.2013. Revised tariff values were notified on these same dates but the Department demanded differential duty based on the revised tariff values.

The appellant contended, supported by RTI responses from Government Press and Customs Department, that the notifications were not published in the Official Gazette or uploaded on the official website on the dates of notification issuance. Notification No. 50/2013 was uploaded only on 06.06.2013 (Government Press) or 29.04.2013 (Customs Department, post-filing time), and Notification No. 57/2013 was uploaded on 18.06.2013 (Government Press) or after 6 pm on 31.05.2013 (Customs Department). Thus, the revised tariff values were not in public domain at the time of filing the Bills of Entry.

The Court examined precedents, notably the Karnataka High Court judgment in the Param Industries case, upheld by the Supreme Court, which held that a notification is effective only from the date of its publication in the Official Gazette. Mere issuance or notification on a website or departmental letterhead without gazette publication does not confer enforceability. The Court emphasized that the date of actual publication or communication to the public is the operative date for such notifications.

The Court also referred to the Supreme Court decision in G.S. Chatha Rice Mills, which clarified that when multiple notifications exist on the same day, the exact time of filing/assessment of the Bill of Entry relative to the timing of notification publication determines the applicable tariff. Since the Bill of Entry filed on 31.05.2013 was presumed to be before 6 pm, and the revised notification was uploaded only after 6 pm, the earlier tariff value would apply.

Issue 3 & 4: Self-assessment and Duty Discharge by the Appellant

The appellant filed Bills of Entry under the Risk Management System (RMS) and self-assessed the customs duty based on the prevailing tariff values known at the time of filing. The Department argued that the appellant was aware of the revised tariff values as they had applied the revised tariff on a subsequent import dated 01.06.2013, and thus should have applied the revised tariff for the disputed consignments.

The Court found that the appellant's self-assessment was consistent with the notifications effectively in force at the time of filing. The Department's reliance on the appellant's later application of the revised tariff was not sufficient to establish knowledge or applicability of the revised tariff on the disputed dates. The Court noted that the system itself had the revised tariff values effective only from 01.06.2013, reinforcing that the appellant was justified in applying the earlier tariff values for imports before that date.

Issue 5: Department's Arguments on Notification Publication and Knowledge

The Department relied on the argument that the notifications were published as news by the Press Information Bureau on the date of notification and that the appellant, being a large and regular importer, should have been aware of the tariff revisions. The adjudicating authority also cited a Supreme Court decision holding that ignorance of law is no excuse for short payment of duty.

The Court rejected these contentions, holding that mere press news does not satisfy the requirement of official publication or availability of the notification to the public. The Court emphasized that the legal test is the date of official publication in the Gazette or availability through official channels, not the knowledge or presumed knowledge of the importer. The Court further held that the appellant's lack of knowledge was irrelevant if the notification was not effectively published or made available on the date of filing.

Cross-References and Application of Law to Facts

The Court consistently applied the principle from Param Industries and G.S. Chatha Rice Mills that the effective date of a tariff notification is the date of its official publication or availability to the public. The timing of filing the Bill of Entry relative to this publication is determinative of the applicable tariff value. The facts showed delayed publication of the notifications at issue and filing of Bills of Entry before such publication, justifying application of the earlier tariff values.

The Court also distinguished the Department's reliance on knowledge or subsequent conduct of the appellant, underscoring that the legal validity of the tariff notification depends on its effective publication, not on the importer's awareness. The Court rejected the Department's contention that the appellant should have paid differential duty after realizing the revised tariff on the same day, as the notification was not officially in force at that time.

Significant Holdings:

"Merely on the basis of notifying in website and showing a letter addressed to the Manager, Government of India Press on 3-8-2001, without actual publication of the notification in the Gazette, it cannot be presumed that there was proper publication as stated."

"The date of actual publication of the notification in the Gazette will be the date on which the effect of such notification can be given."

"The time at which the notification under Section 8A is published would indeed have relevance."

"When the Bill of Entry is filed before the notification is published or uploaded, the tariff value prevailing before the notification will apply."

"Ignorance of change in law is not an excuse for short payment of duty, but this principle applies only when the law is effectively in force and published."

"The appellant's self-assessment based on prevailing tariff value was justified as the revised tariff notification was not effectively published at the time of filing."

"The impugned order confirming demand for differential duty on revised tariff values is not sustainable and is set aside."

The Court conclusively determined that the revised tariff values notified on 26.04.2013 and 31.05.2013 were not applicable to the Bills of Entry filed on those dates due to delayed publication of the notifications. The tariff values prevailing prior to these notifications governed the duty liability. The appellant's discharge of duty based on the prevailing tariff values was lawful and correct. The Department's demand for differential duty was quashed, and the appeal was allowed.