Legal principle

Once the proper officer has assessed the goods and permitted clearance, the assessment cannot be reopened except through review under Section 129D, and where the assessing authority itself accepted the declared value and rate, no mis-declaration or suppression arises to justify invocation of the extended period.

Court decision

The Tribunal allowed the appeal in favour of the appellant and set aside Order-in-Appeal No. GOA/CUS/CM/121/2009 dated 30.11.2009, thereby dislodging the differential duty demand, interest, penalty and redemption fine confirmed against it.

Facts

M/s Semco Electric Pvt. Ltd., a 100% EOU, imported a Die casting machine in 1999 under duty exemption of Notification No. 53/97-Cus dated 03.06.1997. The obsolete machine was sold to a DTA buyer, M/s Zenith Metaplast Pvt. Ltd., against an EPCG licence, on payment of excise duty at 5% on the transaction value of Rs. 10,25,000/-, with written permission from the Deputy Commissioner, Akurdi, Pune and intimation to the Development Commissioner, SEEPZ. Audit objected that duty was payable on the depreciated value (Rs. 12,29,745/-) at the merit rate, not the EPCG rate, and that permission was allegedly refused by the Development Commissioner. A show-cause notice dated 20.02.2008 demanded differential duty of Rs. 6,24,710/- for breach of Notification No. 53/1997-Cus, with confiscation of the machine under Sections 111(d) and (o), interest under Section 28B, and penalties under Sections 112(b) and 114A of the Customs Act. The adjudicating authority and the Commissioner (Appeals) confirmed the demands, prompting this appeal.

Key provisions

• Section 111(d), Customs Act, 1962 — Confiscation of improperly imported goods etc
• Section 28B, Customs Act, 1962 — Duties collected from the buyer to be deposited with the Central Government