Pendency Of Revenue's Appeal Regarding Classification Of Imported Goods No Ground To Insist On Provisional Assessment U/S 18 Customs Act: Delhi HC
Kapil Dhyani
13 Dec 2024 2:00 PM IST
The Delhi High Court has ruled in favour of an importer who was aggrieved by insistence on provisional assessment of duty by the Customs Department, despite an order of the CESTAT with respect to classification of its imported goods. Petitioner-company is involved in providing after sales support services of telecommunication networking equipment and had imported certain goods which...
The Delhi High Court has ruled in favour of an importer who was aggrieved by insistence on provisional assessment of duty by the Customs Department, despite an order of the CESTAT with respect to classification of its imported goods.
Petitioner-company is involved in providing after sales support services of telecommunication networking equipment and had imported certain goods which were alleged to be misclassified,
Petitioner claimed its goods fell under Customs Tariff Heading 851770 (Parts of Cellular Phones and Radio Trunking terminals), exempted from duty under a Notification dated 1st March, 2005.
The Revenue however opined that the goods fell under CTH 85176290 (Machines for the reception, conversion and transmission or regeneration of voice, images or other data, including switching and routing apparatus) and raised a demand of Rs. 13,01,83,674/- along with interest on penalty.
The CESTAT ruled in favour of the Petitioner. Nonetheless, the Revenue continued to insist on provisional assessment of Petitioner's goods under Section 18 of the Customs Act.
Petitioner argued that after the CESTAT's order, it is entitled for release of its goods as per classification decided by the CESTAT and cannot be subjected to provisional assessment.
The Revenue on the other hand contended that the CESTAT order is under challenge before the and, therefore, the Department is empowered to insist on provisional assessment as the issue has not attained finality.
It relied on Section 18(1)(c) which stipulates that where the importer has produced all necessary documents for assessment of duty but the proper officer deems it necessary to make further enquiry, the proper officer may direct that the duty leviable on such goods may be assessed provisionally.
Disagreeing, the High Court held that mere pendency of Revenue's appeal would not entail the department to insist on provisional assessment of the goods.
“Since there is no stay of the order of CESTAT, the goods would have to be released in terms of the CESTAT order dated 18th December 2023 as per the classification as directed by the CESTAT i.e.,CTH 851770,” it ordered.
Appearance: Advocates Ashwini Chandrasekaran, Priyanka Rathi and Shubhangi Gupta for Petitioner; SSC Anurag Ojha with Advocates Dipak Raj and Shubham Kumar for Customs
Case title: M S Ciena Communications India Pvt Ltd v. The Principal Commissioner Of Customs Import & Ors
Case no.: W.P.(C) 14512/2024
