Customs Tariff Act, 1975 goes for major retrospective amendments – aimed at providing machinery provisions for recovery of allied duties of Customs and imposition of penalties

By TIOL News Service

NEW DELHI, JULY 07, 2009: IN addition to the Basic Customs duty and Additional duty of Customs, other duties of Customs like Safeguard duty, countervailing duty on subsidized articles etc are levied under Sections 8B, 8C, and Section 9 of the Customs Tariff Act. It is hard to believe, but the fact remains that there are no machinery provisions so far empowering the recovery of these duties and imposition of penalties for non-payment of duties under these Sections. The provisions of Section 28 of the Customs Act, 1962 are routinely invoked for recovery of these duties and also the other provisions of the Customs Act are invoked for confiscation and penalty.

This issue was agitated by some of the importers successfully and the Tribunal prima facie held that there are no provisions for recovery of safeguard duty under Section 8B of the Customs Tariff Act. (2006-TIOL-1420-CESTAT-MUM)

To overcome such problems relating to recovery of duty and imposition of penalty, Sections 8B, 8C and 9 of the Customs Tariff Act have been proposed to be amended retrospectively to make the provisions of Customs Act, 1962 relating to non-levy, short levy, refunds, offences and penalties to safeguard duty also. The proposed amendments are as under:

Section 8B: A new sub-section 4A is proposed to be inserted with effect from 14.5.1997 as under:

“(4A) The provisions of the Customs Act, 1962 and the rules and regulations made thereunder, including those relating to the date for determination of rate of duty, assessment, non-levy, short levy, refunds, interest, appeals, offences and penalties shall, as far as may be, apply to the duty chargeable under this section as they apply in relation to duties leviable under that Act.”

Section 8C: A new sub-section 5A is proposed to be inserted with effect from 11.5.2002 as under:

“(5A) The provisions of the Customs Act, 1962 and the rules and regulations made thereunder, including those relating to the date for determination of rate of duty, assessment, non-levy, short levy, refunds, interest, appeals, offences and penalties shall, as far as may be, apply to the duty chargeable under this section as they apply in relation to duties leviable under that Act.”

Section 9: A new sub-section 7A is proposed to be inserted with effect from 01.01.1995 as under:

“(7A) The provisions of the Customs Act, 1962 and the rules and regulations made thereunder, including those relating to the date for determination of rate of duty, assessment, non-levy, short levy, refunds, interest, appeals, offences and penalties shall, as far as may be, apply to the duty chargeable under this section as they apply in relation to duties leviable under that Act.”

Interestingly, in Section 9A ( Anti-dumping duty),  a similar sub - section (8) was inserted in Finance Act 2000 and it took 9 years to do the same for safeguard duty. Anyway, why hurry when you can always amend the law retrospectively?