TMI Blog1984 (10) TMI 53X X X X Extracts X X X X X X X X Extracts X X X X ..... for the clearance of the goods was presented on 28-3-1981. With effect from 27-3-1981 auxiliary duty at 5 per cent became payable and additional duty was enhanced from 12.5 percent to 40 percent plus 10 per cent SED. 3.Duties of customs are levied under Section 12 of the Customs Act, 1962 (the "Act") at the rates specified under the Customs Tariff Act, 1975 (the "Tariff Act") or any other law for the time being in force, on goods imported into or exported from India. The date for determination of rate of duty is that which is specified under Section 15 of the Act. Section 25 of the Act has conferred power on the Central Government to exempt specified goods from the whole or any part of the customs duty leviable thereon. The rates at which duties of customs are levied under the Customs Act are specified in the 1st and 2nd Schedules of the Tariff Act (See Section 2 of the Tariff Act). Section 3 of the Tariff Act charges additional duty on articles imported into India. Such duty is equal to the excise duty for the time being leviable on like articles if produced or manufactured in India. The provisions of the Customs Act, 1962 and the rules and regulations made thereunder are, so f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a subsequent Notification No. 75/F. No. 355/8/81-Cus. I, published in the Gazette of India, Extraordinary, Part II, Section 3(i), dated 27-3-1981, the Government of India, in exercise of its powers under Section 25(1) of the Act read with Section 47(4) of the Finance Bill, 1981 (read with Act 16 of 1931), exempted Aluminium ingots (and certain other articles) from so much of auxiliary duty as was in excess of 5 per cent of its value. As a result of this later notification, the earlier Notification dated 25-3-1980 granting the general exemption was impliedly superseded in so far as the goods in question were concerned, and consequently 5 per cent auxiliary duty became payable on such goods. The effect of these notifications as from 27-3-1981 is that, in respect of Aluminium ingots, additional duty was raised from 12.5 per cent to 40 per cent plus 10 per cent SED and auxiliary duty became payable at 5 per cent. The basic customs duty at the relevant time was however Nil. Prior to 27-3-1981 and subsequent to that date during the relevant period duties of customs payable on imported Aluminium ingots may therefore be tabulated as follows : Prior to 27-3-1981 Fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... one as it may deem necessary with respect to the security of India and immigration, sanitation, customs and other fiscal matters or any other matter as the Government may specify by notification. The Union of India is also entitled to exercise sovereign rights of or certain specified purposes in an area beyond and adjacent to the territorial waters and described as the exclusive economic zone, the limit of which is 200 nautical miles from the baseline from which the breadth of the territorial sea is measured. 7.The Customs Act contains various provisions answering the authorities under that Act to exercise jurisdiction over ships and persons not only in the internal waters, i.e. water in ports, harbours, roadsteads and mouths of rivers, but also in the territorial sea and the contiguous zone. These waters are described as the "Indian customs waters" under Section 2(28) of the Act. Power is conferred on the authorities to confiscate any vessel which is or has been within the Indian customs waters while constructed, adopted, altered or fitted in any manner for the purpose of concealing goods or while engaged in the commission of any of the offences mentioned under the Act (Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsumption or warehousing in the prescribed form. The bill of entry may be presented at any time after the delivery of the import manifest. It may be presented even before the delivery of such manifest if the vessel by which the goods have been shipped for importation into India is expected to arrive within a week from the date of such presentation. The importer has to make and subscribe at the foot of the bill of entry a declaration as to the truth of the contents of that document and must, in support of such declaration, produce to the concerned officer the invoice, if any, relating to the imported goods (Section 46). If the concerned officer is satisfied that the goods entered for home consumption are not prohibited goods and the importer has paid proper duty thereon, including charges, if any, the officer may make an order permitting clearance of the goods for home consumption (Section 47). If the goods brought into India from outside are not cleared for home consumption or warehoused or transhipped within two months from the date of their unloading at a customs port, or with such further time as the officer may grant, or if they are abandoned, the person having custody of the g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mported goods after they are cleared for home consumption. The mere act of bringing goods into the port therefore does not constitute an importation, although unexplained it may be evidence of that fact. "If goods, however, are brought into their port of destination for the purpose of being there discharged, the act of importation is complete" per Starke J. in Wilson v. Chambers Co. Pvt. Ltd. (1925-26) 38 C.L.R. 131. As stated by Lord Davey in Canada Sugar Refining Company v. Rea, (1898) A.C. 735 (P.C.), in the context of the Customs Act, 1886 and the Customs Tariff Act, 1894 of Canada, "the words `Imported into Canada', must, in order to give any rational sense to the clause, mean imported at the port of discharge, - ...". It may be that in a general sense the course of import commences at the time the vessel carrying goods intended to be discharged at an Indian port enters the territorial waters for the purpose of proceeding to the port, but the act of import for the purpose of levy does not materialise until the goods have been brought into the port of discharge and the vessel is granted "entry inwards" and the bill of entry has been presented. The levy of duty is made with re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that is applicable on the relevant date. In respect of goods entered for home consumption under Section 46, the rates applicable are those in force on the date on which the bill of entry is presented. However, if the bill of entry has been presented before the date of entry inwards of the vessel, the bill of entry is deemed to have been presented on the date of such entry inwards. This shows that the actual or deemed date of the bill of entry is the point of time with reference to which the rates are determined. In the case of goods cleared from a warehouse under Section 68, the rates applicable are those in force on the date on which the goods are actually removed from the warehouse. In the case of any other goods it is the date of payment that determines the rate of duty. These provisions indicate that the importer is liable to pay duty at the rate in force as specified in Section 15. This Section thus fills up the lacuna of Section 12 which, without the aid of the former, cannot operate and they must therefore be read together. It is with reference to those two Sections that an assessment of duty is made under Section 17. 11.Section 25 confers power on the Central Government t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aterialises or its process becomes complete and the goods become qualified to be cleared to merge with the mass of goods in the country only at the time and place of presentation of the bill of entry and payment of the duties and other charges. What is referred to as the "imported goods" (Section 15) or the "goods imported" Section 12 are goods which are still not released from the stream of import, but have completed the course and are awaiting release by clearance to become part of the mass of goods within the country. The chargeability and the computation of the charges are both centred at that point of time and space as provided in Sections 12 and 15. Any other construction of these provisions so as to separate chargeability from computation by relating chargeability to the time of entry into the territorial waters and computing the duties with reference to the rates then in force is to construe the Sections artificially and contrary to the legislative intent. The general scheme of the Act does not permit the computation to be related to an anterior date. It is intended to be made, in the case of goods entered for home consumption, with reference to the duty payable on the actu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etics and Chemicals Ltd. v. S.C. Coutinho and Others, 1981 (8) E.L.T. 414 (Bom.) and New India Industries Ltd. v. Union of India, 1981 Tax. L.R. 2673, and that of the Madras High Court in M/s. Sundaram Textiles Ltd. v. Asstt. Collector of Customs [1983 (13) E.L.T. 909 (Mad.) = 1983 II M.L.J. 92] where the learned Judge did not follow his earlier decision to the contrary in K. Jamal Co. v. Union of India, 1981 (8) E.L.T. 162 (Mad.) = (1981) M.L.J. 162, and other decisions relied on by the appellants' counsel does not appear to us, with great respect, to be in accord with what seems to us to be the proper construction of the relevant provisions of the Act or with the decisions of the Supreme Court cited above. We respectfully agree with the views expressed on the point by the Delhi High Court in Jain Shudh Vanaspati Ltd. and Anr. v. Union of India and Ors. [1983 (14) E.L.T. 1688 (Del.)] and by the Calcutta High Court in Shewbuxrai Ondarmall v. Asstt. Collector of Customs and Ors. - 1981 (8) E.L.T. 298 (Cal.). 14.There is no substance in the contention that the rates have been applied retrospectively. The rates applied were those in force on the date on which they were determined ..... 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