Case tittle | Priyanka Enterprises VS Joint Commissioner of Customs |
Court | Madras High Court |
Honourable Judge | Justice T.S.Sivagnanam |
Citation | 2017 (11) GSTPanacea 15 HC Madras W.P. NO. 30233 OF 2017 |
Judgment Date | 23-November-2017 |
Heard Mr. Hari Radhakrishnan, the learned counsel representing the petitioner, and Mr. G.M. Syed Nurullah Sheriff, the learned Special Government Pleader representing the respondent. With the agreement of both parties, the writ petition is being addressed and resolved directly.
The petitioner, represented by Mr. Hari Radhakrishnan, challenged an order-in-original dated 07.11.2017 concerning an import made via Bill of Entry No. 3450978 dated 03.10.2017. The imported goods were GSL ARTEMIA BRINE SHRIMP EGGS from M/s. Great Salt Lake Artemia, USA, valued at Rs. 6,44,71,167/-. The petitioner self-assessed the duty under Section 17(1) of the Customs Act, 1962, classifying the goods under Customs Tariff Heading 05119911. Seeking a concessional duty rate of 0% IGST (compared to the standard 5% IGST), the petitioner relied on Notification No. 002/2017-Cus dated 28.06.2017, Sl. No. 33.
The respondent, represented by Mr. G.M. Syed Nurullah Sheriff, disagreed with this classification and opined that the goods should be classified under IGST Notification No. 001/2017, Sl. No. I-21, attracting a 5% IGST rate. Consequently, the respondent did not accept the petitioner’s claim for exemption on the imported goods, citing a prima facie view that it was incorrect. While normally a show cause notice would be issued in such cases, the petitioner had submitted a letter
Mr. Hari Radhakrishnan, representing the petitioner, challenged an order-in-original dated November 7, 2017, concerning the import of GSL ARTEMIA BRINE SHRIMP EGGS from M/s. Great Salt Lake Artemia, USA. The petitioner declared an assessable value of Rs. 6,44,71,167/- and self-assessed the duty under Section 17(1) of the Customs Act, 1962, classifying the goods under Customs Tariff Heading 05119911. Seeking a concessional duty rate of 0% IGST per Notification No. 002/2017-Cus, the petitioner was countered by the respondent, Mr. G.M. Syed Nurullah Sheriff, who argued for a 5% IGST rate under Notification No. 001/2017, Sl.No.I-21.
Despite the usual requirement for a show cause notice, the petitioner opted for adjudication without one, resulting in the impugned order. This order not only addressed the specific import under Bill of Entry No. 3450978 but also included an earlier import under Bill of Entry No. 2311679, invoking Section 111(m) of the Customs Act to re-assess and levy a 5% IGST, confirming differential duty payment, and offering redemption of goods under certain conditions.
The Court noted concerns regarding the respondent’s use of Section 111(m), as there was no indication that the goods did not correspond in value or other particulars with their entry under the Act. The respondent acknowledged no dispute over the goods’ classification but refrained from final adjudication, allowing the petitioner to appeal to the appropriate authority.
Mr. Hari Radhakrishnan, representing the petitioner, and Mr. G.M. Syed Nurullah Sheriff, representing the respondent, both appeared before the court with mutual consent to address the writ petition directly. The petitioner contested an order-in-original dated November 7, 2017, concerning the import of GSL Artemia Brine Shrimp Eggs from M/s. Great Salt Lake Artemia, USA, valued at Rs. 6,44,71,167. The petitioner self-assessed customs duty under Section 17(1) of the Customs Act, 1962, classifying the goods under Customs Tariff Heading 05119911. Seeking a concessional duty rate of 0% IGST instead of 5% IGST, the petitioner relied on Notification No.002/2017-Cus dated June 28, 2017, Sl.No.33.
The respondent, however, contended that the goods should be classified under IGST Notification No.001/2017 Sl.No.I-21, attracting IGST at 5%. Despite the usual requirement for a show cause notice, the petitioner requested adjudication without one in a letter dated October 12, 2017, which was granted. Subsequently, the respondent’s order extended beyond the specific consignment covered by Bill of Entry No.3450978 dated October 3, 2017, to include an earlier import covered by Bill of Entry No.2311679 dated July 4, 2017. This invoked Section 111(m) of the Customs Act, leading to re-assessment of both entries, imposition of 5% IGST, confirmation of differential duty payment, and an option for redemption of goods under Bill of Entry No.3450978 upon payment of a Rs. 60,00,000 fine, while no fine was imposed on goods under Bill of Entry No.2311679.
The petitioner challenged the invocation of Section 111(m), asserting that there were no discrepancies in declared values or other particulars. The respondent acknowledged the correct classification of goods but deferred final adjudication to the appellate authority, the Commissioner of Customs (Appeals), Chennai. Due to the goods’ perishable nature (with a shelf life of six months, already two months elapsed) and administrative delays (the vacant position of the Commissioner of Customs (Appeals)), the petitioner sought court intervention for conditional release of the goods pending appeal.
In conclusion, the court acknowledged the need for expediency due to the goods’ perishability and administrative circumstances, considering the petitioner’s request for conditional release pending appeal to the appellate authority.
The petitioner challenged an order-in-original dated 07.11.2017 concerning an import of GSL ARTEMIA BRINE SHRIMP EGGS from the USA. The petitioner self-assessed customs duty under Customs Tariff Heading 05119911, seeking a concessional IGST rate of 0% based on Notification No.002/2017-Cus. However, the respondent classified the goods under IGST Notification No.001/2017 Sl.No.I-21, imposing IGST at 5%. Without issuing a show cause notice, the respondent adjudicated the case, re-assessed duties, and ordered confiscation of goods with an option for redemption on payment of a fine. The petitioner sought relief from the court, questioning the invocation of Section 111(m) of the Customs Act and requesting release of goods due to their perishable nature and administrative delays in the appellate authority.
The court granted the petitioner liberty to appeal to the Commissioner of Customs (Appeals), Chennai within 30 days, directing payment of differential duties totaling Rs. 31,70,083/-. Upon remittance of these duties, the respondent was instructed to provisionally release the goods within seven days for both Bills of Entry.
This summary captures the main legal arguments, procedural decisions, and relief sought by the petitioner.
In a recent legal proceeding, Mr. Hari Radhakrishnan, representing the petitioner, and Mr. G.M. Syed Nurullah Sheriff, the government’s counsel, appeared before the court with mutual consent to proceed with the writ petition for resolution.
The petitioner contested an order-in-original dated 07.11.2017 concerning the import of GSL ARTEMIA BRINE SHRIMP EGGS from M/s. Great Salt Lake Artemia, USA, valued at Rs. 6,44,71,167/-. The petitioner self-assessed the duty under Customs Act, 1962, classifying the goods under Customs Tariff Heading 05119911. Seeking a concessional duty rate of 0% IGST as per Notification No. 002/2017-Cus, the respondent disagreed, suggesting a 5% IGST rate under Notification No. 001/2017.
Instead of issuing a show cause notice, the petitioner requested adjudication, leading to the contested order. The respondent’s order not only covered the specific import but also earlier entries, invoking Section 111(m) of the Customs Act to re-assess and impose duties. The order allowed redemption of goods from one entry on payment of a fine but refrained from imposing a fine on goods from another entry.
The court found that Section 111(m) invocation lacked merit as no discrepancy in declared values was alleged. While acknowledging no dispute over classification, the court deferred further adjudication pending appellate review. Due to the goods’ short shelf life and administrative delays, the court permitted the petitioner to appeal to the Commissioner of Customs (Appeals), Chennai, within thirty days.
The court’s directions included paying differential duties and providing a bond for fines, ensuring provisional cargo release pending appeal. The petitioner retained rights to argue all points before the appellate authority, independent of the court’s observations. Additionally, the court granted a detention certificate as per regulations.
Ultimately, the writ petition was disposed of with no costs awarded, and related petitions were closed accordingly.
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