Tata Chemicals Ltd. vs Union of India

I.P. Mukerji, J.—Tata Chemicals Limited, the writ petitioner is proposing to import muriate of potash, due to arrive shortly in the Port of Kolkata by the vessel MV Ultra Wollongong. There is no dispute that in respect of this importation 5% basic duty is payable. But the question is whether 1% countervailing duty claimed by the Customs is payable.

Mr. J.P. Khaitan, learned senior advocate cites Notification No. 12/2012-C.E., dated 17th March, 2012. According to Serial No. 127 and heading 31 thereof, fertilizers which are imported for the manufacture of other fertilizers are exempted from any countervailing duty. He submits that this fertilizer is unquestionably imported for this purpose and does not attract any countervailing duty.

For whatever reasons his client is unable to file a bill of entry in the electronic form claiming the above exemption.

According to Mr. Khaitan, the system is not accepting a bill of entry with a claim to such exemption. He draws my attention to a communication dated 11th December, 2013 of the Ministry of Finance, Tax Research Unit to the Chief Commissioner of Central Excise and Customs, Visakhapatnam Zone stipulating that manual bills of entry may continue to be accepted.

Mr. Bharadwaj for the Customs submits that the issue whether the petitioner is utilising the imported materials for the manufacture of fertilizers is before the Commissioner of Customs (Appeals). This is in respect of an earlier importation. Furthermore, the petitioner should be directed to file the bill of entry electronically for payment of the duty as claimed by the department.

I am unable to fully endorse this submission.

Deriving strength from the above communication dated 11th December, 2013 I direct the respondent-authorities to accept the bill or bills of entry in respect of the impugned import in manual form claiming the above exemption.

The above [Notification] dated 17th March, 2012 is quite explicit that the fertilizers imported for the purpose of use in the manufacture of other fertilizers are exempted from countervailing duty. This position is accepted by the department, but it disputes whether the petitioner is utilising such materials for manufacture of fertilizers.

In those circumstances, importation of the goods cannot be held up.

I also direct the respondent-authorities to provisionally release the above goods after filing of the manual bill or bills of entry by the petitioner, within five working days of arrival of the goods, upon the petitioner furnishing a bank guarantee to secure the 1% countervailing duty and upon payment of the basic duty.

Final of assessment may be carried out within three months from date.

Nothing remains of this writ application. Affidavits were not invited. Allegations contained in the writ application are deemed not to be admitted.

This writ application is accordingly disposed of. Certified photocopy of this order, if applied for, be supplied to the parties upon compliance with all requisite formalities.