Customs - No retrospective effect for exemption notification; No interest payable if bond does not specify it - Supreme Court.
The Supreme Court delivered another important judgement yesterday.
The case had all the complications - Export obligation, anti dumping duty, calculation of duty, interest, and penalty.
The important issues decided by the Supreme Court were:
No retrospective effect for exemption: The exemption from Anti Dumping Duty has no reference to the earlier proceedings in the case and is obviously intended to apply only prospectively.
Appellant cannot be worse off by reason of filing an appeal: In this case, the CESTAT increased the rate of anti dumping duty on an appeal filed by the assessee. There was no appeal by Revenue. Supreme Court held that Tribunal could not have enhanced the rate at which the appellant would have to pay Anti-dumping duty in the appellant's own appeal. The appellant cannot be worse off by reason of filing an appeal.
No condition of interest in the Bond - No interest payable. In this interesting issue, the appellant took a plea that in the bond executed by him, he had not undertaken to pay interest. The Supreme Court looked at the bond and observed that the bond says nothing about any interest that is payable in case the conditions of the Notification are not met. On this short ground alone, it is clear that no interest is payable on any of the customs duties that are due from the appellant.
Whether Anti-dumping duty can be included in calculating special customs duty and special additional duty. No; It will be noticed that additional duty and special additional duty would include "any sum chargeable on that article under any law for the time being in force as an addition to, and in the same manner as, a duty of customs". What has been contended is that these words would refer only to a surcharge provision and not to a provision which levies an independent duty, as the relevant words are "an addition" and not "in addition". This is as per the Law in force at the relevant time..
Penalty: As far as penalty is concerned, the Court found that the appellant has not diverted goods meant for export to the domestic tariff area. The market considerations made it difficult, if not impossible, for the appellant to fulfill its export obligations and therefore, the penalty imposed in the present case is set aside.