TMI Blog2001 (6) TMI 71X X X X Extracts X X X X X X X X Extracts X X X X ..... ch any manufacturer engaged in export business of their finished goods could import any raw material to be used in manufacture of finished goods without payment of customs duty. Petitioner claiming to be such manufacturer imported certain goods (C.R. Coils) under OGL (Open General Licence/Advance Licence) and kept them in warehouse of Government as per the requirement of Customs Act till the formalities of clearance were completed by the concerned authorities. By letter dated 11-9-1989 (Annexure B), the petitioner requested the Collector Customs and Central Excise to allow them to remove/release their goods i.e. C.R. Coils without payment of customs duty and interest as according to petitioner in terms of Chapter XIX of Export-Import policy 1988-91 and Notification No. 116/88, dated 30-3-1988, the goods imported by any assessee under OGL, or any person claiming to be the supported manufacturer of the goods can claim exemption from payment of duty on the said goods. The petitioner therefore, claimed that they being a supported manufacturers of one Company M/s. Arandi (P) Ltd. who have duly authorised them against their advance licence are entitled to remove the goods in terms of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at when there is no duty there can be no interest and hence, the amount deposited by the petitioner towards interest be refunded. 5.While the aforesaid application was pending or/and instead of deciding the said application, the Assistant Collector, on 27-5-1992 (Annexure H) issued a show cause notice to the petitioner. By this show cause notice, it was said that why a refund application made by the petitioner in claiming refund of interest amount be not rejected. The show cause was founded on these two grounds :- 2. - Where as on scrutiny of the above refund claim it has been found that (1) The goods were originally Imported under OGL but at the specific requirement of the importer were allowed to be cleared against advance licence and the importer agreed to pay interest. (ii) The goods were chargeable to duty at the time of importation and assessment but subsequently only the goods were cleared without payment of duty against advance licence which did not waive any interest leviable on duty." 6.The petitioner by their two reply (Dated 16-6-1992 Annexure I) and dated 17-9-1992 Annexure II opposed the show cause and asserted that they are entitled for refund of their money wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the respondents to demand interest. Learned Counsel placed heavy reliance on the decision of Supreme Court reported in 1996 (88) E.L.T. 12 (S.C.) Pratibha Processors v. Union of India and 1991 (52) E.L.T. 357 (Ker.) which according to learned Counsel decided this very issue in favour of petitioner. This, in substance, was the submission pressed into service by the learned Counsel for the petitioner. 11.In reply, learned Counsel for the respondent while defending the impugned proceedings including the impugned order, relied on the decision of Supreme Court rendered in Mafatlal's case and urged that this petition has rendered infructuous inasmuch as the remedy of petitioner was to apply to the authorities for claiming refund within the time mentioned in the said decision. Yet another submission was that petitioner has an alternative remedy of an appeal to challenge the impugned order. In the last place, learned Counsel while relying on the decision of Calcutta High Court, reported in 1993 (66) E.L.T. 361 submitted that the issue decided by the authority concerned is covered by the said Calcutta decision and hence, be upheld. These were mainly the submission, pressed into service b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he respondent must fail. It is rejected. 15.Coming to the merits of the case, I am inclined to hold that the issue on merits is fully covered in favour of petitioner by the decision of Supreme Court rendered in the case of Pratibha Processors v. Union of India - 1996 (88) E.L.T. 12, supra. 16.Indeed this very issue which is raised by the petitioner in this case by claiming refund of amount deposited by them by way of interest demanded by the Customs Authorities was formulated by their Lordships of Supreme Court while deciding the appeal :- The question that arose for consideration was posed, thus :- "On importation of goods under OGL if the importers had kept the same in the warehouse under Section 59 of the Act and after expiry of statutory period of three months if they clear the goods under the Advance licence issued under DEEC Scheme, whether such importers are liable to pay interest on the amount of duty which was assessed and ascertained on the date of warehousing until the goods is cleared under Section 68 of the Act (excluding the free period of three months)." 17.After examining the entire scheme of the Customs Act and in particular Sections 15, 25, 59, 61 and 68 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ious conduct or for a deliberate violation of the provisions of the particular statute. Interest is compensatory in character and is imposed on an assessee who has withheld payment of any tax as and when it is due and payable. The levy of interest is geared to actual amount of tax withheld and the extent of the delay in paying the tax on the due date. Essentially, it is compensatory and different from penalty which is penal in character. In the above backdrop, let us14. consider the scope and content of Section 61(2) of the Act as it existed at the relevant time. Section 61(1) prescribes the period during which the goods imported may remain in the warehouse. The normal period in different cases are provided therein. Extension of time in special cases is also provided. If the goods imported remain in warehouse beyond the period provided or extended under Section 61(1), the consequences are specified in Section 61(2) of the Act. As per the provisions of the Act duty is payable (only) when the goods are cleared. If the goods are not cleared within the time granted under Section 61(1) of the Act, and the goods are cleared later, the payment of duty exigible on the goods gets automati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... including Counsel fee Rs. 5,000/- in each case." 18.Now when I examine the facts of this case noted supra, I do not find any distinguishing or rather significant distinguishing feature in the facts of this case and that of one involved in Pratibha Processors case, supra, so as to distinguish the law laid down by their Lordships in the said case. Indeed as observed supra, facts are almost identical and therefore, it is difficult for one to accept the submission of learned Counsel for the respondents. 19.This was also a case where the petitioner either they may be discribed as manufacturer or supporting manufacturer of M/s. Arandi (P) Ltd., had imported the goods against OGL/Advance licence and kept them in warehouse as per requirement of Section 59 of the Act. It is also not in dispute that petitioner cleared the goods after their prayer was accepted by the Customs Board. It is also not in dispute that the order of Board held the field throughout and was therefore, binding on the customs authorities. Mere reference in the order of Board to pay interest would not by itself tentamount to a legal binding unless it satisfy the requirement of Act. In other words, the same has to be i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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