Legal principle

Interest on customs duty can be levied only under a substantive statutory provision operating prospectively — the Section 18(3) liability (effective 13.7.2006) does not apply to provisional assessments made earlier — and the Central Government retains its settled power to grant exemption under Section 25(1) of the Customs Act even while levying anti-dumping duty.

Court decision

The petition was dismissed to the extent it challenged Notification No.69/2000 dated 19.05.2000: no interference was called for, the Court holding that the Central Government is entitled to grant exemption under Section 25(1) of the Customs Act and that the exemption clause applies only in futuro. On interest, the Court held the petitioner was not liable to pay any interest on the anti-dumping duty leviable under Notification No.69/2000 until its revocation by Notification No.22/2004 (with effect from 2004). Interim relief was vacated forthwith (though continued up to 31.07.2024 on the petitioner's request), the rule was discharged and no order as to costs was made.

Facts

The petitioner, a company engaged in importing Low Ash Metallurgical Coke (Metcoke) classified under Heading 27.04 of the Customs Tariff Act, 1975, challenged Notification No.69/2000-Customs dated 19.05.2000 by which the Central Government, accepting a CEGAT order dated 21.01.2000, fixed anti-dumping duty on Metcoke from China P.R. at US$24.95 per Metric Ton and exempted imports by pig iron/steel manufacturers using blast furnaces. The duty followed anti-dumping proceedings initiated in 1997 before the Designated Authority, which yielded provisional duty of Rs.1800 per MT (Notification No.22/98) and later final findings, modified by CEGAT to a fixed dollar-denominated duty. Separately, the Kandla Commissionerate had sought duty on an assumed over-invoicing basis (US$65 per MT), which was litigated in an earlier Special Civil Application. During the pendency of the present petition, the petitioner cleared goods on undertaking/bond under interim orders of the Court.

Key provisions

• Section 25(1), Customs Act, 1962 — Power to grant exemption from duty
• Section 3(2), Customs Tariff Act, 1975 — Levy of additional duty equal to excise duty, sales tax, local taxes and other charges
• Section 3A(2), Customs Tariff Act, 1975 — Omitted [****]
• Section 14, Customs Act, 1962 — Valuation of goods
• Section 12, Customs Act, 1962 — Dutiable goods
• Section 3, Customs Act, 1962 — Classes of officers of customs
• Section 9A, Customs Tariff Act, 1975 — Anti- dumping duty on dumped articles
• Section 9(2), Customs Tariff Act, 1975 — Countervailing duty on subsidized articles
• Rule 20(2)(a), Customs Tariff (Identification, Assessment and Collection of Anti-Dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995 — Commencement of duty