TMI Blog1996 (3) TMI 134X X X X Extracts X X X X X X X X Extracts X X X X ..... the duty became due on issuing the notice of demand. The notice prescribed fifteen days for payment. Interest is chargeable only thereafter as held by the High Court, which, in our opinion, is a reasonable way of understanding the provision. Thus no justification or legal basis for the appellants' plea that the interest must be paid taking the rate of the duty at ninety percent for the said entire period. As a matter of fact, the rate of duty on the said goods was not ninety percent throughout the period March 22, 1985 to September 9, 1988. It was varying. The High Court's direction, therefore, to take the actual rate in force from time to time is a reasonable one. We are, therefore, of the opinion that the judgment of the High Court does n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ge against whose decision both the respondent and the Union of India filed writ appeals. The Division Bench of the Karnataka High Court disposed of the writ appeals with the following directions : The respondents are directed to re-compute the amount of"(a) interest payable by the petitioner at the prescribed rate with effect from 22-3-1985 upto 9-9-1988 on the basis of the amount of customs duty which the petitioner would have been liable to pay to the Central Government at the rate, which was prevailing during the different periods between 22-3-1985 to 9-9-1988; After computing the total amount of interest payable for the(b) entire period as directed above, the respondents shall refund the balance of the amount of interest collected f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e date so specified at the rate of six percent per annum or such other rate as is for the time being fixed by the Board; and (c) to discharge all penalties incurred for violation of the provisions of this Act and the rules and regulations in respect of such goods." A reading of Section 59 (1) shows that an importer who seeks to have the imported goods warehoused has to first have the goods assessed under Section 17 or Section 18, as the case may be, and then execute a bond binding himself to pay double the amount of duty assessed on the said goods and undertaking "to pay on or before a date specified in a notice of demand all duties, rent and charges claimable on account of such goods under this Act, together with interest on the same f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Section 61 for the reason that it was relied upon by the appellant before us, though, in our opinion, it is not really relevant herein as we shall point out presently. 4.In this case, the respondent did execute a bond as contemplated by Section 59(1) while warehousing the goods on November 11, 1982. Though the period of three years prescribed in Section 61(1)(a) was reduced to one year by an Amendment Act with effect from May 13, 1983, neither the respondent cleared the goods nor the authorities issued a demand notice within one year from May 13, 1983. Only on March 7, 1985 did the authorities issue a notice to the respondent calling upon him to clear the goods on paying the appropriate duty. Now, according to the Act, the duty payable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e specified in the notice of demand. We have already extracted Clause (b) in full hereinbefore. The liability to pay interest arises only after the expiry of the period prescribed in the notice of demand. It has been held by the High Court that the present matter is not governed by Section 61(2), as it stood at the relevant time, but by Section 59(1) alone. Indeed, it is submitted that when the respondent applied for extension of time of warehousing under Section 61(2), the Government told it that the said provision had no application and hence, time cannot be extended thereunder. Once that is so, we must go by what Section 59(1) says. According to it, the duty became due on issuing the notice of demand. The notice prescribed fifteen days f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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