By TIOL News Service

NEW DELHI, AUG 19, 2014: THE question for decision by the Tribunal in this appeal is whether interest shall be levied on the differential duty u/s 18(3) of Customs Act, 1962 in respect of provisional assessments made before 13.07.2006 but finalised on 18.07.2011.

The Bench after hearing the lengthy submissions made by both sides observed -

++ While provisional assessment was completed on 18.02.2005 above sub-section was not in the statute book. The date on which duty liability arises under law is prescribed by section 15 of the Act. According to that section in the case of goods entering for home consumption under section 46 of the Act, the date of presentation of bill of entry shall be the date to determine the rate of duty applicable. Accordingly, the duty liability arose in case of imports made by the appellant on the date the bills of entry were presented. Those were presented much before the finalisation of the provisional assessment made on 18.02.2005. Indisputably, the bills of entry in the present case were filed by the appellant during the period April 2002 to May 2004. At that time, sub-section (3) to section 18 was not in force.

++ Fiscal statute creating liability is strictly construed. Sub-section (3) enacted on 13.07.2006 is not presumable to govern the cases of bills of entries filed prior to that date and provisional assessments also completed prior to that. It is settled principle of law that every statute is prima facie prospective unless it is expressly or by necessary implication made to have a retrospective operation. But the rule in general is applicable where the object of the statute is to affect vested rights or to impose new burdens to impair existing obligations. Unless there are words in the statute sufficient to show the intention of legislature to affect existing rights, it is deemed to be prospective only.

A new law ought to regulate what is to follow, not the past. It is not necessary that an express provision be made to make a stature retrospective and the presumption against retrospectivity may be rebutted by necessary implication especially in a case where the new law is made to cure an acknowledged evil for the benefit of the community as a whole.

++ The above rule of interpretation guides to hold that when subsection (3) was not in force on the date of filing of Bills of entry nor existing even on the date of finalisation of provisional assessments, but was enacted on 13.07.06, that shall have no application to the case of the appellant for the reason that it is, by now, well settled that the statutory amendments, either creating fresh liability hitherto not existing or extinguishing accrued rights would be considered prospective unless statute either specifically or by necessary implication gives such provision retrospective effect. [CC(preventive) v. Goyal Traders 2011-TIOL-568-HC-AHM-CUS refers]

In fine, the appeal was allowed.

(See 2014-TIOL-1541-CESTAT-DEL)