M/S. Ruchi Soya Industries Ltd vs Union Of India & Ors
2022 Latest Caselaw 5362 Cal

                     IN THE HIGH COURT AT CALCUTTA
                       Constitutional Writ Jurisdiction
                               Appellate Side


Present :-   Hon'ble Mr. Justice Md. Nizamuddin



                               WPA No. 1354 of 2021

                           M/s. Ruchi Soya Industries Ltd.
                                         Vs
                                Union of India & Ors.


      For the Petitioner             :- Mr. Rajesh Rawal, Adv.
                                        Mr. Prithu Dudhoria, Adv.


      For the Respondent             :- Mr. B.P. Banerjee, Adv.
                                        Mr. Abhradip Maity, Adv.



      Judgement On                   :-       12.08.2022


   MD. NIZAMUDDIN, J.

Heard learned counsel appearing for the parties.

This Writ Petition has been filed by the petitioner being aggrieved by the

action of the respondents customs authorities concerned charging enhanced

rate of duty on the consignments in question on the basis of the impugned

notification No. 103/2020-Customs (N.T.) dated 29th October, 2020 effective

and operational from 23:18:25 hrs of 2020 by applying the same retrospectively

and making prayer for quashing the impugned reassessment of bills of entry in

question on the basis of which petitioner was asked to pay duty of higher tariff

value for clearance of the goods in question.

Main legal issues involve in this Writ Petition are as hereunder,-

(i) Whether as per Section 15 of the Customs Act, 1962, for

determination of the rate of duty and valuation of imported goods, in the case

of goods in question which entered for home consumption under Section 46 of

the Customs Act, only the date on which the bills of entry in respect of the

goods is presented is the only criteria or the time of presenting the bill of entry

on said date is also an essential criteria for determination of rate of duty?

(ii) Whether action of the respondents customs authority concerned was

legally justified in charging the enhanced rate of duty on the goods in question

on the basis of the impugned notification No. 103/2020-Customs (N.T.) dated

29.10.2020 which was e-gazetted and digitally signed on 29.10.2020 at

23:18:25 hrs whereby Tariff Value of the subject goods was enhanced from

USD 755MT to USD 782 MT while it is an admitted position substantiated by

record that bills of entry relating to goods in question were already self

assessed on 23.10.2020 and 26.10.2020 at the prevailing rate of duty and

Entry inward was granted to the vessel in question carrying the subject goods

on 29.10.2020 at 11:00 hrs which is the time prior to the time of coming into

effect the aforesaid E-Gazetted Notification dated 29.10.2020 at 23:18:25 hrs?

(iii) Whether on the facts and in the circumstances of the case and in

view of Section 15 read with Section 46 of the Customs Act, 1962 and in view

of the law laid down by the Hon'ble Supreme Court in the case of Union of

India & Ors. -Vs- G.S. Chatha Rice Mills & Anr. reported in 2020 SCC OnLine

SC 770, charging at enhanced rate of duty on the goods in question on the

basis of the aforesaid E-Gazette Notification dated 29.10.2020 by giving

retrospective effect to it, is arbitrary, illegal and contrary to law?

Relevant facts involved in brief in the instant case as appears from record

are as hereunder.

On 14.9.2020, 16.9.2020, 02.10.2020 and 08.10.2020 petitioner entered

into four contracts dated 14.9.2020, 16.9.2020, 02.10.2020 and 08.10.2020

with its foreign supplier at Singapore for import of 14000 MTs of Crude Palm

Oil of Edible Grade in Bulk. Against the aforesaid contracts aforementioned

named foreign supplier supplied 13,084.71 MTs of the subject goods vide

vessel MT Tiger Harmony.

The aforesaid subject goods were supplied on 12.10.2020 against Six

Invoices (two invoices dated 30.09.2020, one invoice dated 1.10.2020,

02.10.2020, 11.10.2020 and 12.10.2020 respectively). Further, the aforesaid

subject goods were shipped against Sixteen Bills of Landing (five Bills of

Landing dated 30.9.2020, four Bills of Landing dated 01.10.2020, six Bills of

Landing dated 11.10.2020 and one Bill of Landing dated 12.10.2020).

On 15.10.2020 tariff value in regard to the subject goods was fixed at the

rate of 755 USD PMT vide notification No. 100/2020-Customs (N.T.) dated

15.10.2020 issued under Section 14 (2) of the Customs Act, 1962.

Petitioner filed seven Bills of Entry under self-assessment for 10084.717

MTs of the subject goods under Section 46 of the Customs Act, 1962 on

21.10.2020 and 22.10.2020, seeking clearance of the said goods for home

consumption.

Petitioner paid the assessed Social Welfare Surcharge and IGST on

23.10.2020 and 26.10.2020 vide seven Receipts, five receipts dated 23.10.2020

and two receipts dated 26.10.2020. Petitioner submitted that in total an

amount of Rs. 6,11,27,023/- was paid vide aforesaid seven receipts (Social

Welfare Surcharge amounting to Rs. 2,12,00,124/- and IGST amounting to Rs.

3,99,26,899/-).

Petitioner contended that vessel carrying the subject goods arrived at Haldia

Port on 24.10.2020 but on account of congestion at the port the vessel was

unable to secure a berth. It submitted that on account of factors beyond the

control of the petitioner and for no fault of the petitioner and since there was

heavy congestion at the Haldia port the vessel carrying the subject goods could

not secure a berth and Entry Inward was granted to the vessel carrying the

subject goods on 29.10.2020 at 11:00 hours and on securing berth, discharge

of the subject goods in the shore tank commenced at 13:35 hours on

29.10.2020 and the cargo stood discharged on 21:25 hours on 31.10.2020. It

appears from record that on 29.10.2020 at 23:18:25 hours, Notification

No.103/2020-Customs (N.T.) dated 29.10.2020 was e-Gazetted, having been

digitally signed on 29.10.2020 at 23:18:25 hours, whereby tariff value of the

subject goods were increased from USD 755 PMT to USD 782 PMT.

On 02.11.2020, on discharge of the cargo in the shore tank, there was short

quantity receipt of 110.51 MTs and the total quantity of cargo that was

discharged in the shore tank was 9947.207 MTs. The subject goods/cargo

stood discharged in the shore tank on 31.10.2020 which was Saturday and 1st

November, 2020 being Sunday, 'Out Turn Report' was prepared on 02.11.2020.

Petitioner submitted that on 04.11.2020 reassessment of the subject bills of

entry lead to payment of excess amount to the tune of Rs. 96,60,467/- which

amount petitioner is claiming refund. In regard to six subject Bills of Entry

Nos. 9265797, 9265801 and 9266091 all dated 21.10.2020 and Bill of Entry

Nos. 9272115, 9275141 and 9276627 all dated 22.10.2020, additional basic

customs duty was to the tune of Rs. 73,56,538/- and additional social welfare

surcharge and IGST to the tune of Rs. 21,21,134/- and in regard to one subject

Bill of Entry No. 9277219 dated 22.10.2020, additional basis customs duty

was to the tune of Rs. 1,41,884/- and additional social welfare surcharge and

IGST to the tune of Rs. 40,909/-. The aforesaid amounts were paid by the

petitioner vide seven receipts all dated 4.11.2020.

Petitioner submitted that on 3.11.2020 and 4.11.2020 on account of

reassessment of the subject Bills of Entry, it wrote letters to the respondents,

which were duly received and acknowledged by them on 3.11.2020 and

4.11.2020 and on 05.11.2020 on realizing the error in calculation of the

additional duly amount, petitioner wrote letters dated 05.11.2020 to the

respondents, which were duly received and acknowledged by them on

06.11.2020.

Learned Counsel appearing for the petitioner in support of its contention

and claim of refund of excess payment of Duty has relied on a decision of the

Apex Court in the case of Union of India -Vs- G.S. Chatha Rice Mills reported

in 2020 SCC OnLine SC 770.

Learned counsel appearing for the respondents opposing the Writ

Petition submits that admittedly there was a self-assessment on the bills of

entry on 21.10.2020 and 22.10.2020 as per the then existing rates of tariff but

the same was done before the arrival and entry inward of vessel but he could

not deny and dispute that both bills of entry and self-assessment were

presented and inward entry of the vessel in question of the same was before the

impugned notification which was effective and operational from 23:18:25 hrs

on 29th October, 2020 when it was officially E-gazetted and digitally signed. He

further submits that the self assessment date of the said bills of entry in

question should be considered on the date of notification e-gazetted on

29.10.2020 and digitally signed at 23:18:25 hrs and the time of notification is

not the considering factor even if self assessment was done and entry inward of

the vessel was prior to the time of e-gazetting of the said notification.

Before coming to the conclusion in this matter I would like to refer some

provisions of Customs Act, 1962 which are relevant to this case and are quoted

hereunder:

"15. Date for determination of rate of duty and tariff valuation of

imported goods

(1) The rate of duty and tariff valuation, if any, applicable to any imported

goods, shall be the rate and valuation in force,--

(a) in the case of goods entered for home consumption under section 46, on the

date on which a bill of entry in respect of such goods is presented under that

section;

(b) in the case of goods cleared from a warehouse under section 68, on the date

on which [a bill of entry for home consumption in respect of such goods is

presented under that section];

(c) in the case of any other goods, on the date of payment of duty:

[Provided that if a bill of entry has been presented before the date of entry

inwards of the vessel or the arrival of the aircraft or the vehicle by which the

goods are imported, the bill of entry shall be deemed to have been presented on

the date of such entry inwards or the arrival, as the case may be.]

(2) The provisions of this section shall not apply to baggage and goods imported

by post."

"17. Assessment of duty

(1) After an importer has entered any imported goods under section 46 or an

exporter has entered any export goods under section 50, shall, save as

otherwise provided in Section 85, self-assess the duty, if any, leviable on such

goods.

(2) The proper officer may verify the entries made under Section 46 or Section

50 and the self-assessment of goods referred to in sub-section (1) and for this

purpose, examine or test any imported goods or export goods or such part

thereof as may be necessary:

[PROVIDED that the selection of cases for verification shall primarily be on the

basis of risk evaluation through appropriate selection criteria.]

(3) For the purpose of verification under sub-section (2), the proper officer may

require the importer, exporter or any other person to produce any document or

information, whereby the duty leviable on the imported goods or export goods,

as the case may be, can be ascertained and thereupon, the importer, exporter

or such other person shall produce such document and furnish such

information.

(4) Where it is found on verification, examination or testing of the goods or

otherwise that the self-assessment is not done correctly, the proper officer may,

without prejudice to any other action which may be taken under this Act, re-

assess the duty leviable on such goods.

................................................"

"46. Entry of goods on importation

(1) The importer of any goods, other than goods intended for transit or

transshipment, shall make entry thereof by presenting electronically on the

customs automated system to the proper officer a bill of entry for home

consumption or warehousing in such form and manner as may be prescribed.

.............................................

(3) The importer shall present the bill of entry under sub-section (1) before the

end of the day (including holidays) prescribing the day on which the aircraft or

vessel or carrying the goods arrives at a customs station at which such goods

are to be cleared for home consumption or warehousing.

[PROVIDED that the Board may, in such cases as it may deem fit, prescribe

different time limits for presentation of the bill of entry, which shall not be later

than the end of the day of such arrival:

PROVIDED FURTHER that a bill of entry may be presented at any time not

exceeding thirty days prior to the expected arrival of the aircraft or vessel or

vehicle by which the goods have been shipped for importation into India:]

......................................"

"47. Clearance of goods for home consumption

(1) Where the proper officer is satisfied that any goods entered for home

consumption are not prohibited goods and the importer has paid the import

duty, if any, assessed thereon and any charges payable under this Act in

respect of the same, the proper officer may make an order permitting clearance

of the goods for home consumption.

[PROVIDED that such order may also be made electronically through the

customs automated system on the basis of risk evaluation through appropriate

selection criteria:

PROVIDED FURTHER that the Central Government may, by notification in the

Official Gazette, permit certain class of importers to make deferred payment of

said duty or any charges in such manner as may be provided by rules.]

(2) The importer shall pay the import duty-

(a) on the date of presentation of the bill of entry in the case of self-assessment;

or

(b) within one day (excluding holidays) from the date on which the bill of entry

is returned to him by the proper officer for payment of duty in the case of

assessment, reassessment or provisional assessment;

............................................."

"68. Clearance of warehoused goods for home consumption

Any warehoused goods may be cleared from the warehouse for home

consumption, if -

(a) bill of entry for home consumption in respect of such goods has

presented in the prescribed form;

(b) the import duty, interest, fine and penalties payable in respect of such

goods have been paid; and

(c) an order for clearance of such goods for home consumption has been

made by the proper officer:

[PROVIDED that the order referred to in Clause (c) may also be made

electronically through the customs automated system on the basis of risk

evaluation through appropriate selection criteria:

............................"

Learned counsel appearing for the petitioner in support of his contention for

refund of excess rate of tariff collected by the respondents on the goods in

question, has relied on a decision of the Hon'ble Supreme Court in the case of

Union of India -Vs- G.S. Chatha Rice Mills reported in 2020 SCC OnLine SC

770, relevant Paragraphs of the said Judgment are quoted hereunder:

"11. The batch of petitions before the High Court involved cases of other

similarly situated importers. The facts pertaining to the writ petitions, as

gleaned from the judgment of the High Court, are summarized below:

(i) the goods were imported in the ordinary course of trade from Pakistan;

(ii) the goods entered Indian territory through the Attari border at Amritsar

before 18:00 hours on 16 February 2019;

(iii) the importers had filed bills of entry under Section 46 of the Customs

Act, before the close of working hours, seeking clearance of the goods

for home consumption;

(iv) the value and description of the goods were declared;

(v) the importers had self-assessed the goods in terms of the prevailing

notifications and had filed the bills of entry in the EDI system;

(vi) the declarations were subject to verification by the customs department

which did not dispute them and generated duty payment TR-6 challans;

(vii) since 16 February 2019 was a Saturday, the customs' office was closed

after 18:00 hours and was to open on Monday,18 February 2019;

(viii) some of the importers paid the duty online through TR-6 challans on 16

February 2019 while in the case of others, the payment of duty was in

progress;

(ix) Notification 5/2019 was issued at 20:46:58 hours on 16 February 2019

following the Pulwama terrorist attack as a result of which the rate of

duty on goods originating in Pakistan was enhanced to 200 per cent

irrespective of the fact that some of the products had hitherto been

exempt from customs duty; and

(x) the customs authorities refused to release the goods on the basis of the

bills of entry which were self-assessed at the pre-existing rate and

proceeded to recall them and re-assess the goods to the enhanced rate

of duty applicable under notification 5/2019."

"28. The proviso to Section 15 (1) contemplates a situation where a bill of entry

has been presented before the date of the entry inwards of the vessel or the

arrival of the aircraft or vehicle through which the goods are imported. Under

the proviso to Section 46(3), a bill of entry may be presented at any time not

exceeding thirty days prior to the expected arrival of the aircraft or vehicle by

which the goods have been shipped for importation into India. Dealing with

such a situation, the proviso to Section 15(1) states that if a bill of entry has

been presented prior to the date of the entry inwards of the vessel or the arrival

of the aircraft or vehicle by which the goods are imported, the bill of entry is

deemed to have been presented on the date of the entry inwards or the arrival

of the goods. Hence even where the bill of entry has been presented before the

date of the entry inwards or the arrival of the aircraft or vehicle, the rate of

duty is determined with reference to the date of entry inwards or the arrival of

the aircraft or vehicle. This is a consequence of the deeming fiction under the

proviso, as a result of which the presentation of the bill of entry, when filed

prior to the arrival of the goods, is deemed to be on the date of the entry

inwards or the arrival of the aircraft or vehicle. Hence, implicit in the provisions

of Section 15(1) are the dual or (as counsel before the court described them)

the twin requirements of (i) the presentation of the bill of entry; and (ii) the

entry inwards of the vessel or, as the case may be, the arrival of the aircraft or

vehicle."

"33. The amendment of 2011 has made significant legislative changes in the

procedure and modalities for assessment of duty under Section 17. Under sub-

section 1 of Section 17, the importer entering imported goods under Section 46,

has to 'self-assess' duty (except as otherwise envisaged in the provisions of

Section 85). Under sub-section (2), the proper officer may verify the entries

made under Section 46 and the self-assessment made under sub-section (1)

and may examine or test the goods. The selection of goods for verification has

to be primarily on the basis of risk evaluation through appropriate selection

criteria. Under sub-section (4), where it is found on verification, examination or

testing of goods or otherwise that the self-assessment has not been done

properly the proper officer is entrusted with a power of re-assessment. Sub-

section (5) requires the passing of a speaking order upon re-assessment."

"40. Regulation 4 provides as follows:

"4. (1) The authorised person shall file the bill of entry before the end of the

next day following the day (excluding holidays) on which the aircraft or vessel

or vehicle carrying the goods arrives at a customs station at which such goods

are to be cleared for home consumption or warehousing.

(2) The bill of entry shall be deemed to have been filed and self-assessment

completed when after entry of the electronic integrated declaration on the

customs automated system or by way of data entry through the service centre,

a bill of entry number is generated by the Indian Customs Electronic Data

Interchange System for the said declaration and the self-assessed copy of the

Bill of Entry may be electronically transmitted to the authorised person or

printed out at the service centre.

(3) Where the bill of entry is not filed within the time specified in sub-regulation

(1) and the proper officer of Customs is satisfied that there was no sufficient

cause for such delay, the importer shall be liable to pay charges for late

presentation of the bill of entry at the rate of ......"

(emphasis supplied)

"41. The Regulations of 2018 have made provisions for submission of a

declaration and generation of the bill of entry in an electronic form on the

automated platform provided by the Central Board of Indirect Taxes and

Customs. Sub-regulation (2) of Regulation 4 embodies a legal fiction.

Regulation 4(2) stipulates that the bill of entry is deemed to have been filed and

self-assessment completed when after the entry of the electronic integrated

declaration on the customs automated system (or by data entry through a

service centre) a bill of entry number is generated by the Indian Customs

Electronic Data Interchange ("EDI") System. The self-assessed copy of the bill of

entry may be electronically transmitted to the authorized person under the

deeming fiction which is created by Regulation 4(2). Hence, the bill of entry is

deemed to be filed and the self-assessment completed when the requirements

of Regulation 4(2) are fulfilled namely by the (i) entry of the declaration on the

customs automated system; and (ii) generation of a bill of entry number by the

EDI system. Following this, the self-assessed copy of the bill of entry is

electronically transmitted to the authorized person."

"42. In terms of the provisions of Section 15(1)(a), in the case of goods which

are entered for home consumption under Section 46, the date of presentation

of the bill of entry determines the rate of duty and tariff valuation. Under

Section 47(2)(a), the importer is obliged to pay the import duty on the date of

the presentation of the bill of entry in the case of self-assessment. Regulation

4(2) of the Regulations of 2018 categorically stipulates when the presentation of

the bill of entry is complete. Once the bill of entry is deemed to have been

presented in terms of Regulation 4(2) the rate and valuation in force stand

crystalized under Section 15(1)(a). Section 17(4) confers a power of re-

assessment on the proper officer where it is found on verification, examination

or testing of the goods or otherwise- that the self-assessment has not been

done correctly. In the present case the customs authorities sought to exercise

the power of re-assessment on the ground of the subsequent notification

enhancing the rate of duty. The fact of the matter is that self-assessment was

carried out on the basis of the rate of duty which prevailed at the time of the

presentation of the bill of entry. This is not and cannot be a matter of dispute.

Notification 5/2019, which introduced a new tariff entry - 980 60 000 - in the

First schedule to the Customs Tariff Act covering all goods originating in or

exported from the Islamic Republic of Pakistan, was not in force at the time

when the self-assessment was carried out."

"43. Under Section 15(1)(a) the rate of duty is the rate in force on the date of

the presentation of a bill of entry where the goods are entered for home

consumption under Section 46. The submission of the learned ASG is that the

expression "on the date" is adopted by the legislature in clauses (a) and (b) and

in the proviso to Section 15(1). He urged that Section 15(1) has no reference to

time but only to the date of the presentation of the bill of entry and once a

notification was issued on 16 February 2019 enhancing the rate of duty, that is

the duty 'in force' on the date of presentation. Section 15(1)(a) uses two

expressions (i) the rate and valuation "in force"; and (ii) "on the date" of the

presentation of the bill of entry for home consumption under Section 46. The

provisions of Section 15(1)(a) have to be read in conjunction with the provisions

of Section 46 which are referred to in the former provision. Section 46 has

incorporated a regime which encompasses the submission of the bill of entry

for home consumption or warehousing in an electronic format, on the customs

automated system in the manner which is prescribed. The Regulations of 2018

stipulate the manner in which the bill of entry has to be presented. The

deeming fiction in Regulation 4(2) specifies when presentation of the bill of

entry and 'self-assessment' are complete. The rate of duty stands crystallized

under Section 15(1)(a) once the deeming fiction under Regulation 4(2) comes

into existence. The regulations have to be read together with the statutory

provisions contained in Section 15(1)(a) and Section 46, while determining the

rate of duty."

"66. It is with these principles of interpretation in mind that we must evaluate

the submission which was urged by Mr Nataraj, on behalf of the Union, that

upon the issuance of a notification enhancing the rate of duty under Section

8A of the Customs Tariff Act, the date on which the notification was issued will

govern the rate applicable to all bills of entry, including those which were

presented before the enhanced rate was notified. The submission cannot be

accepted for several reasons. For one thing, it misses the significance of the

expression "in force' which has been employed in the prefatory part of Section

15(1). A notification under Section 8A(1) of the Customs Tariff Act, even though

it has the effect of amending the First Schedule, takes effect prospectively.

Section 8A does not confer upon the notification an operation anterior to its

making. In the language of the law, its operation is prospective. To accept the

submission of the ASG would mean that the notification under Section 8A

would have effect prior to its making, something which Parliament has not

incorporated by language or intent. If, as we hold, the notification operates for

the future beginning with the point of its adoption, it cannot operate to displace

the rate of duty which is applicable when a bill of entry is presented for home

consumption under Section 46."

"67. The submission of the Union cannot be accepted in view of the provisions

contained in Section 46 for the presentation of a bill of entry for home

consumption in an electronic form on the customs automated system. While

making that provision, specifically by means of an amendment by Act 8 of 2011

and later by the Finance Act of 2018, Parliament used the expression "in such

form and manner as may be prescribed." Regulation 4(2) of the Regulations of

2018 provides when the bill of entry shall be deemed to have been filed and

self-assessment completed. The legal fiction which has been embodied in

Regulation 4(2) emanates from the enabling provisions of Section 46. The

provisions of Sections 15(1)(a), 17, 46(1) and 47(2)(a) constitute one composite

scheme. As a result of the modalities prescribed for the electronic presentation

of the bill of entry and self-assessment after the entry of the electronic

declaration on the customs automated system, a bill of entry number is

generated by the EDI system for the declaration. Regulation 4(2) provides for a

deeming fiction in regard to the filing of the bill of entry and the completion of

self-assessment. In the context of these specific provisions, it would do violence

to the overall scheme of the statute to interpret the language of Section 15(1)(a)

in the manner in which it is sought to be interpreted by the ASG. The

submission of the ASG, simply put, is that because notification 5/2019 was

issued on 16 February 2019, the court must regardless of the time at which it

was uploaded on the e-Gazette treat it as being in existence with effect from

midnight or 0000 hours on 16 February 2019. The consequence of this

interpretation would be to do violence to the language of Section 8A(1) of the

Customs Tariff Act, and to disregard the meaning, intent and purpose

underlying the adoption of provisions in the Customs Act in regard to the

electronic filing of the bill of entry and the completion of self-assessment."

"95. Digital signatures have contextual information including the date and

time built into them. Under the Digital Signature (End entity) Rules 2015,

provisions for time stamps for digital signatures are built into the legal regime

under Rule 4(4) and, in the context of a long term valid digital signature, in

Rule 4(7)."

"100. On 30 September 2015, the Ministry of Urban Development issued an

Office Memorandum numbered No. O-17022/1/2015-PSP-l which

discontinued the practice of physical printing and replaced it with the

electronic gazette. The notification, in relevant part, reads as follows:

"In compliance with the provisions of Section 8 of the

Information Technology Act, 2000, it has been decided in

consultation with Department of Legal Affairs to switch over to

exclusive e-publishing of the Government of India Gazette

Notification on its official website with effect from 01.10.2015

and to do away with the physical printing of Gazette

Notification. The date of publishing shall be the date of e-

publication on official website by way of electronic gazette in

respect of Gazette notification."

(emphasis supplied)

"103. The High Court upheld the Petitioner's view that the notifications were

inapplicable to the petitioners after considering Section 8 of the Information

Technology Act, 2000 along with the Office Memorandum dated 30.9.2015. It

held:

"32. The endorsement on the electronic copy of the Gazette,

whereby the impugned Notification Nos. 24 and 25, dated 25th August, 2017,

were notified, seen in juxtaposition with Section 8 of the IT Act, and of the OM

dated 30th September, 2015 supra, of the Ministry of Urban Development,

makes it clear that the impugned Notification Nos. 24 and 25, dated 25th

August, 2017 were, in fact, electronically published in the Official Gazette only

at or after 10:47 p.m. on 28th August, 2017.

........................................."

"104. Thus, the High Court regarded the time of publication as the relevant

marker for determining the enforceability of the notifications. The issue of

determining the starting point for the enforceability of a notification in the

electronic gazette was considered by the Andhra Pradesh High Court in Ruchi

Soya Industries v. Union of India. The petitioner entered into a contract with its

foreign supplier on 18 January 2008 for the import of 9,500 Metric Tons of

crude oil. The first consignment of 4000 metric tons was shipped by the

supplier on 6 February 2018 from Dubai. The petitioner filed two bills of entry

for 2000 metric tons of crude oil on 1 March 2018. They were assessed that

day and levied with 30% customs duty and 10% social welfare surcharge. On

the same date, a notification raised the basic customs duty from 30 to 44%.

The petitioner filed four bills of entry for the remaining 2000 tons on 2 March

2018 and argued that the revised rate was not applicable to it because the

notification was published in the electronic gazette only on 6 March 2018. The

High Court agreed with the petitioner and held that the revised notification

would come into force only after it was digitally signed by the competent official

and uploaded and published in the official gazette. The relevant excerpt from

page 41 of the High Court's judgment is quoted below:

"....The notification was published electronically on 6.3.2018. In view

of the decision taken by the Government of India in terms of Section 8 of the

Information Technology Act, to avoid physical printing of Gazette notification to

publish the same exclusively by electronic mode, so as to attribute knowledge

to the public at large. The notification was signed by Rakesh Sukul on

6.3.2018 at 19:15:13 + 05'30'. When notification needs to be signed digitally

and only when the notification was uploaded and published in the Official

Gazette, the same is made available for public."

"106. With the change in the manner of publishing gazette notifications from

analog to digital, the precise time when the gazette is published in the

electronic mode assumes significance. Notification 5/2019, which is akin to the

exercise of delegated legislative power, under the emergency power to notify

and revise tariff duty under Section 8A of the Customs Tariff Act, 1975, cannot

operate retrospectively, unless authorized by statute. In the era of the

electronic publication of gazette notifications and electronic filing of bills of

entry, the revised rate of import duty under the Notification 5/2019 applies to

bills of entry presented for home consumption after the notification was

uploaded in the e-Gazette at 20:46:58 hours on 16 February 2019."

"124. In the present case the twin conditions of Section 15 stood determined

prior to the issuance of Notification 5/2019 on 16 February 2019 at 20:46:58

hours. The rate of duty was determined by the presentation of the bills of entry

for home consumption in the electronic form under Section 46. Self-

assessment was on the basis of rate of duty which was in force on the date and

at the time of presentation of the bills of entry for home consumption. This

could not have been altered in the purported exercise of the power of re-

assessment under Section 17 or at the time of the clearance of the goods for

home consumption under Section 47. The rate of duty which was applicable

was crystallized at the time and on the date of the presentation of the bills of

entry in terms of the provisions of Section 15 read with Regulation 4(2) of the

Regulations of 2018. The power of re-assessment under Section 17(4) could not

have been exercised since this is not a case where there was an incorrect self-

assessment of duty. The duty was correctly assessed at the time of self-

assessment in terms of the duty which was in force on that date and at the

time. The subsequent publication of the notification bearing 5/2019 did not

furnish a valid basis for re-assessment."

"208. In the context of the Customs Act, and having regard to the Scheme,

which, in the case of import duty, consists of filing of Bill of Entry for home

consumption, self-assessment and payment of duty on the basis of the same

and the rate being clearly fixed with reference to the particular point of time

when the Bill of Entry is presented and there is a deemed presentation and

even a deemed assessment, which is otherwise in order, and bearing in mind

the principle that Section 8A does not provide power for increase of rate of duty

with retrospective effect, the Notification must be treated as having coming into

force not before its publication which is at 20:46:58 hrs. on 16.02.2019. This

would necessarily mean that the Notification cannot be used to alter the rate of

duty on the basis of which, in fact, there was presentation of Bill of Entry

several hours ago, the self-assessment was done and what is more, the self-

assessment was completed under Regulation 4(2) of the 2018 Regulations.

There cannot be re-assessment. The interpretation based on time of publication

is in harmony with a view that accords respect for vested rights."

Considering the facts and circumstances of the case as appears from

record, submission of the parties, relevant provisions of law and the aforesaid

judgment of the Hon'ble Supreme Court in the case of G.S. Chatha Rice Mills &

Anr. (supra), I am inclined to allow this Writ Petition by holding as follows:

(i) As per Section 15 of the Customs Act, 1962, for determination of the

rate of duty and valuation of imported goods, in the case of goods in question

which entered for home consumption under Section 46 of the Customs Act, not

only the date on which the bills of entry in respect of the goods is presented is

the only criteria rather the time of presenting the bill of entry on the said date

is also an essential criteria for determination of rate of duty on the goods in

question.

(ii) Action of the respondents customs authority concerned charging at the

enhanced rate of duty on the goods in question on the basis of the impugned

notification No. 103/2020-Customs (N.T.) dated 29.10.2020 which was e-

gazetted and digitally signed on 29.10.2020 at 23:18:25 hrs whereby Tariff

Value of the subject goods was enhanced from USD 755MT to USD 782 MT is

not justifiable in law since it is an admitted position substantiated by record

that bills of entry relating to goods in question were already self assessed on

23.10.2020 and 26.10.2020 at the prevailing rate of duty and Entry inward

was granted to the vessel in question carrying the subject goods on 29.10.2020

at 11:00 hrs which is the time prior to the time of coming into effect the

aforesaid E-Gazetted Notification dated 29.10.2020 at 23:18:25 hrs.

(iii) On the facts and in the circumstances of the case and in view of

Section 15 read with Section 46 of the Customs Act, 1962 and in view of the

law laid down by the Hon'ble Supreme Court in the case of Union of India &

Ors. -Vs- G.S. Chatha Rice Mills & Anr. reported in 2020 SCC OnLine SC 770,

action of the respondents customs authority charging at enhanced rate of duty

on the goods in question on the basis of the aforesaid E-Gazette Notification

dated 29.10.2020 by giving retrospective effect to it, is arbitrary, illegal and not

sustainable in law.

Accordingly the respondents/authorities concerned are directed to refund

to the petitioners the excess duty amounting to Rs. 96,60,467/- which was

collected by the respondent customs authority on the basis of the aforesaid

impugned Notification No. 103/2020-Customs (N.T.) dated 29th October, 2020

at a higher tariff value, within a period of 8 weeks from the date of

communication of this order. Petitioner will be at liberty to claim for interest on

the aforesaid amount to be refunded in accordance with law.

In view of discussion, observation and direction made hereinabove, this

Writ Petition being WPA No. 1354 of 2021 stands disposed of by allowing the

same. No order as to costs.

Urgent certified photocopy of this judgment, if applied for, be supplied to the

parties upon compliance with all requisite formalities.

(MD. NIZAMUDDIN, J.)