Calcutta High Court (Appellete Side)
Oliya Steel Pvt. Ltd vs Commissioner Of Customs ... on 19 May, 2022
19-05-2022 IN THE HIGH COURT AT CALCUTTA
Item No. 02 Constitutional Writ Jurisdiction
KS Appellate Side
WPA No.6261 of 2022
Oliya Steel Pvt. Ltd.
-vs-
Commissioner of Customs (Preventive), West Bengal,
Kolkata & Ors.
Mr. Moinak Bose
Mr. S.M. Akhter
...for the petitioner
Mr. Kaushik Dey
Mr. Tapan Bhanja
...for the State
Heard learned advocates for the parties.
Petitioner in this writ petition has challenged the
impugned action of the respondent-Customs authority
changing the classification of "boiled betel nut (Supari)"
being unit no.21069030 in its self-assessment order dated
March 8, 2017 as appears from page 27 of the writ petition
and according to the petitioner no duty is payable on the
same as per Advance Ruling dated March 31, 2017 as
appears from page 30 of the writ petition. Petitioner is
further aggrieved by inaction on the part of the Customs
authority in releasing the aforesaid boiled betel nut in
question. In support of his contention, petitioner has relied
on section 2(2) of the Customs Act, 1962 and contends that
the assessment includes self-assessment; and if the
Customs authority was not agreeable to accept the self-
assessment by the petitioner, then they could have filed
appeal against the same. In support of this contention,
petitioner has relied upon a judgment of the Hon'ble
Supreme Court in the case of ITC Limited v. Commissioner
of Central Excise, Kolkata reported in 2 (2019) 17 SCC 46
at paragraph 43. Petitioner submits that the respondent
shall also be bound to observe formalities under section
17(4) of the Customs Act, 1962, if it was disagreeable to the
classification declared by the petitioner; and it is the case of
the petitioner that in this case neither the statutory
obligation or formalities of section 17(4) of the Act has been
observed by the Customs authority, nor it has filed any
appeal against the self-assessment order. The petitioner
further submits that the ruling of the Advance Rulings
Authority dated March 31, 2017 in petitioner's own case is
also binding upon the Customs authority under section 28J
of the Act. As such, the impugned action of the respondents
changing classification of the items in question is clearly in
violation of the ruling of the Advance Rulings Authority and
that petitioner is entitled to release the items in question.
Learned Advocate appearing for the respondents opposing
the Writ Petition submits as hereunder:
The goods i.e. Boiled Betel Nut (Supari) imported by the
petitioner under the Bill of Entry No. 7862395 dated
14.03.2022 under CTH 21069030 was self assessed by the
petitioner assessing the duty to the tune of Rs.
10877497.00.
The said bill of entry was re-assessed and the CTH has been
change to 08028090 as per clarification given by STO
(TARIFF UNIT), CBIC in respect of classification of import of
beetel nut under different nomenclature, viz. Boiled
Arecanut, Beetel Nut, Boiled Supari, Api Supari, Chikni
Supari, Unflavored Supari and Flavoured Supari etc. Vide
F. No. 528/09/2020-S.T.O (T.U) dated 07.02.2022 and
value enhanced as per MIP for the same as per Notification
no. 03/2022 - Customs (N.T.) dated 14.01.2022. The B/E
assessed accordingly.
If the petitioner is not agreed with the assessment, the
petitioner is required to upload his disagreement letter. In
this regard para-2(a)(v) of the Circular No. 55/2020-
Customs 17.12.2020 provides inter alia that ".... (v) where
the assessing officer re-assesses the Bill of Entry and where
the importer does not accept the change in assessment in
writing, through the query module in ICES, the proper
officer shall mandatorily issue a speaking order without
delay and in accordance with sub-section (5) of Section 17
of Customs Act, 1962.
The petitioner instead of going for the proper adjudicating
proceeding, has over stepped and filed the instant writ
petition.
In the instant case there has been change in law after
issuance of Notification no. 03/2022- Customs (N.T.) dated
14.01.2022. The said notification has been issued in
exercise of the powers conferred by sub-section (2) of
Section 14 of the Customs Act, 1962 wherein Areca Nuts is
classifiable under CTH 080280.
Moreover, the Advance Ruling in the case of Oliya Steel
relied upon by the petitioner has been taken up for
consideration by the Authority for Advance Ruling, New
Delhi in subsequent Rulings i.e. in the case of M/s. Vaibhav
Enterprise, M/s. Exor Overseas, SRG Enterprises and
Morchhadi Traders wherein the Authority dissented the
earlier Ruling in the case of Oliya Steel and unequivocally
observed that Boiled Supari is not classifiable under sub-
heading 21069030 as food preparation, instead it is more
appropriately classifiable under Sub-heading 080280. While
arriving the aforesaid finding the Authority for Advance
Ruling has followed the decision in the case of S.T.
Enterprise -vs- Commissioner of Customs,(Chennai VII)
reported in 2021 (378) E.L.T. (Tri-Chennai). In the said
order the learned Tribunal has considered the Ruling in the
case of Oliya Steel Pvt. Ltd. (the petitioner herein) and
Excellent Betelnut Product Pvt. Ltd. and concluded that
since the import goods are 'betel nuts whole' these would
merit classification under Chapter 8. The said decision of
the learned Tribunal of Chennai has been upheld by the
Hon'ble Supreme Court.
That the self-assessment of Bill of Entry made by the
importer/petitioner, becomes an Order only after its
assessment by the proper officer. Until and unless it is
accepted/assessed by the proper officer, it remains
declaration of the Importer regarding its CTH, Value and
other particulars shown as self-assessment. Only after its
assessment, it becomes an Assessment Order. Further, if
the contention of the petitioner is accepted then the
provisions contained in Section 17 of the Act will become
redundant and/or otiose. Moreover, the decision in the case
of ITC relied upon by the petitioner is not applicable in this
case. As the said case relates to claim of refund under
Section 27 of the Customs Act, 1962 and discussed the
scope of the provisions of refund under Section 27 of the
Customs Act, 1962.
As regards the release of the goods, i.e. Boiled nut
respondents submit that until and unless, the duty
assessed is not paid and reflected in the system, the gate
pass for releasing the goods is not generated by the system.
In the instant case, the assessed duty has not yet been
paid.
Considering the submission of the parties I am of the view
that apart from above facts, questions of law are also
involved in this Writ Petition and which can be adjudicated
only on affidavit-in-opposition from the respondents and
the Writ Petition can't be disposed of at motion stage
without calling for any affidavit from the respondents.
Respondents shall file affidavit-in-opposition within four
weeks after Summer Vacation, petitioner to file reply thereto
if any within two weeks thereafter.
So far as petitioner's prayer for interim relief of release of
goods in question during the pendency of the Writ Petition
is concerned, considering the balance of convenience of the
parties and considering the aspect of protection of interest
of revenue, the goods in question shall be released by the
respondent concerned on condition of deposit of Rupees
One Crore in cash out of the total demand and in addition
fifty per cent of the balance amount by way of bank
guarantee in the name of and subject to satisfaction of the
respondent customs authority concerned and the same
shall be renewed from time to time and the same will be
encashed only after final disposal of the Writ Petition and
the respondents concerned shall release the goods in
question within seven days from the date of compliance of
the aforesaid terms and condition by the petitioner.
List this matter after seven weeks for final hearing.
[Md. Nizamuddin, J]
