GHANSHYAM DAS SURESHCHAND Vs. UNION OF INDIA

JUDGEMENT

(1.) In this writ petition the only question that arises for consideration is the question of interest payable on the import duty in respect of goods imported by the petitioner. The brief facts are that the petitioner imported, inter alia, cloves in 1988-89. The goods were warehoused on 16.3.1989. On the same date a warehousing bond was executed and furnished by the petitioner in respect of the said goods. Thereafter, various events took place with which we need not concern ourselves. The main issue centres around the notice of demand issued on 05.07.1991 whereunder a demand was raised on the petitioner by the revenue authorities in respect of the custom duty as well as interest payable on the custom duty. It is the contention of the respondents that interest on custom duty was payable by the petitioner for the period 16.06.1989 to 05.07.1991, in the first instance and thereafter, from 05.07.1991 till the date the goods were cleared from the warehouse. The custom authorities by virtue of the said notice of demand dated 05.07.1991 computed the interest on custom duty for the first period i.e. 16.06.1989 to 05.07.1991 at Rs.2,22,808.00. For the subsequent period, the notice of demand indicated that interest would be charged at the rate of Rs.265.00 per day till the date of clearance. It is an admitted position that the goods were cleared on 13.07.1991. On the other hand, the petitioner contends that interest was not leviable or payable from the date indicated in the notice of demand i.e. from 16.6.89 and that in fact interest, if at all, should only be charged after the date of the notice of demand, i.e., 05.07.1991.

(2.) The amount of duty is not in dispute. The only dispute is with respect to the date from which the interest on the custom duty would become payable. The petitioner contends that the date is 05.07.1991 whereas the respondents contend that the date is 16.06.1989 as given in the notice of demand.

(3.) However, it appears that, this question is no longer res integra in view of the Supreme Court decision in Union of India v. Bangalore Wire Rod Mill, (1996) 3 SCC 588. In this decision, the Supreme Court considered the provisions of Sections 59 (1) and 61(2) of the Customs Act, 1962 and after construing the same came to the following conclusions: