Legal principle

A claim to preferential duty on the strength of a certificate of origin cannot be rejected by a non-speaking order; doubts about the COO must be tested through the verification procedure under Section 28-DA/CAROTAR 2020 through the designated Verification Authority, and authorities under a Central enactment must not draw diametrically opposite conclusions on identical facts.

Court decision

The writ petition was allowed: the impugned order dated 21.4.2021 was quashed and a mandamus was issued for release of the goods forthwith, in any event within one week. The court held the petitioner had satisfied the requirement of production of a valid COO, while leaving the Department free to make further enquiry if it still harboured apprehensions about the COO; a request for a detention certificate was left to the authorities to consider in accordance with law.

Facts

M/s.Aabis International imported 17,700 kgs of areca nuts of Sri Lankan origin through Chennai port under Bill of Entry dated 26.02.2021, claiming zero customs duty under Notification No.26/2000 (India-Sri Lanka Free Trade Agreement) on the strength of a certificate of origin issued by the Department of Commerce, Colombo. Assessment was made under Section 17 via faceless assessment, duty was remitted, the COO was defaced as a precursor to release and physical examination was waived. While awaiting the out-of-charge order, the Deputy Commissioner (R2) raised objections to the authenticity of the COO (date stamp reading '07' or '17', and a stamp reading 'issued retrospectively'). By the impugned order dated 21.04.2021 the assessment was revised, the exemption was rejected, and a demand of duty was raised, without any reasons being recorded, while the perishable consignment remained unreleased.

Key provisions

• Section 17, Customs Act, 1962 — Assessment of duty