1. On 16th August, 1985, the appellant, through its clearing agents, lodged a Bill of Entry for home consumption. On 20th August, 1985, the appellant wrote the following letter to the Assistant Collector of Customs :
Sub : 40 Bales Cashmilon, Brand Acrylic Fibre IGM No. 1958/249 s.s. Eastern Splendour M/s. Bharat Commerce & Ind. Ltd., Bombay.
The above mentioned B/Entry was noted for Home Consumption on 16-8-1985, but the Importer has instructed us now to prepare and clear the Material Under Bond. Since they are having shortage of funds and unable to pay the Import duty for the time being.
Kindly allow us to cancel the Home Consumption B/Entry and allow fresh B/Entry under Bond.
2. The grievance of the appellant is that no action was taken on this application. On 26th August, 1985 the appellant wrote a second letter to the Assistant Collector of Customs to the following effect:
Sub : Allow to cancel the Home Consumption Bill of Entries No. 1958/249, 252 & 251 and to file Bond B/Entries. Imported M/s. Bharat Commerce & Industries Limited.
As per the instruction by importer, we request you to, kindly allow us to file Bond Bill of Entries.
3. It has been recorded by the Tribunal that this letter dated 26th August, 1985 was received by the Assistant Collector in the morning of 28th August, 1985. In the afternoon of 28th August, 1985, it came to be known that the rate of duty on the imported goods were reduced. The question is whether the appellant was liable to pay the duty at the newly introduced lower rate.
4. On behalf of the appellant it has been contended that no prescribed form is provided for application for changing the Bill of entry for home consumption to a Bill of Entry for warehousing. He had made an application for cancellation of the Bill of Entry for home consumption and a second application was made on 26-8-1985. The first application for cancellation was not acted upon. Due to the latches of the Assistant Collector of Customs, he cannot be made to suffer. He made a second application. That too was not disposed of promptly. The second application, ultimately, was not allowed on the ground that the rate of tax had been reduced with effect from 28-8-1985 and the change will cause prejudice to the Revenue. The case of the appellant is that the appellant was unaware of any proposal of the Government to lower the taxes. The appellant in good faith had asked for warehousing of the goods because there were problems with the appellants factory at Punjab. The appellant could not clear the goods and remove them to the Punjab factory which was temporarily closed. That is why he wanted the goods to be warehoused for the time being.
5. The main difficulty in upholding this contention is the provisions of the Customs Act. Section 15 and Section 46 of the Act, which are relevant for the purpose of this case, are as under :
15. Date for determination of rate of duty and tariff valuation of imported goods. - (1) The rate of duty and tariff valuation, if any, applicable to any imported goods, shall be the rate and valuation in force, -
(a) in the case of goods entered for home consumption under Section 46, on the date on which a bill of entry in respect of such goods is presented under that section;
(b) in the case of goods cleared from a warehouse under Section 68, on the date on which the goods are actually removed from the warehouse;
(c) in the case of any other goods, on the date of payment of duty;
46. Entry of Goods on Importation. - (1) The importer of any goods, other than goods intended for transit or transshipment, shall make entry thereof by presenting to the proper officer a bill of entry for home consumption or warehousing in the prescribed form :
Provided that if the importer makes and subscribes to a declaration before the proper officer, to the effect that he is unable for want of full information to furnish all the particulars of the goods required under this sub-section, the proper officer may, pending the production of such information, permit him, previous to the entry thereof: (a) to examine the goods in the presence of an officer of Customs, or (b) to deposit the goods in a public warehouse appointed under Section 57 without warehousing the same.
(2) Save as otherwise permitted by the proper officer, a bill of entry shall include all the goods mentioned in the bill of lading or other receipt given by the carrier to the consignor.
(3) A bill of entry under Sub-section (1) may be presented at any time after the delivery of the import manifest or import report as the case may be :
Provided that the Collector of Customs may in any special circumstances permit a bill of entry to be presented before the delivery of such report.
Provided further that a bill of entry may be presented even before the delivery of such manifest if the vessel by which the goods have been shipped for importation into India is expected to arrive within a week from the date of such presentation.
(4) The importer while presenting a bill of entry shall at the foot thereof make and subscribe to a declaration as to the truth of the contents of such bill of entry and shall, in support of such declaration, produce to the proper officer the invoice, if any, relating to the imported goods.
(5) If the proper officer is satisfied that the interests of revenue are not prejudicially affected and that there was no fraudulent intention, he may permit substitution of a bill of entry for home consumption for a bill of entry for warehousing or vice versa.
6. The rate of duty and tariff valuation in the case of goods entered for home consumption will be on the date on which the bill of entry in respect of such goods is presented under Section 15(1)(a). In this case the bill of entry for home consumption was actually presented on 16th August, 1985 so that rate of duty will be the rate in force on that day. It was open to the importer to lodge a bill of entry for warehousing. In that case, the rate of duty would have been the rate in force on the date on which the goods were actually removed from the warehouse.
7. The appellant for reasons best known to him presented a bill of entry for home consumption on 16th August, 1985, allegedly wrote a letter on 20th August, 1985 for permission to lodge a fresh bill of entry for warehousing and finally wrote another letter dated 26th August, 1985 which was received by the Department on 28th August, 1985 accompanied by a bill of entry for home consumption. The appellant's case is that Sub-section (5) of Section 46 permits it to substitute a bill of entry for home consumption for a bill of entry for warehousing. But, so far as the first application dated 16th August, 1985 is concerned, admittedly no bill of entry was lodged; so, no question of substituting one bill of entry for another arises.
8. It was contended that this letter dated 16th August, 1985 should have been treated as sufficient by the Customs Officer to pass suitable order under Sub-section (5) of Section 46 allowing substitution of the bill of entry for home consumption for the bill of entry for warehousing.
9. It was also contended that no particular form is prescribed for making an application of this nature. There is no formality to be complied with. The Customs Officer was in error in ignoring this letter.
10. We are unable to uphold the contention. Assuming that the letter dated 16th August, 1985 was sent to the Customs Officer, that letter by itself could not be treated as a bill of entry for warehousing. Sub-section (1) of Section 46 requires presentation to the proper officer of a bill of entry for home consumption or warehousing in the prescribed form. Sub-section (2) lays down that the bills of entry shall include all the goods mentioned in the bill of lading or other receipts given by the carrier to the consignor. Sub-section (4) of Section 46 requires the importer to make a declaration as to the truth of the contents of such bill of entry and to produce documents in support of such declaration. It is difficult to see in the context of these provisions how the letter could be treated as a bill of entry for warehousing. What Sub-section (5) contemplates is substitution, of one bill of entry for another. In order to effect the substitution a second bill of entry must be lodged which will be in substitution of the first bill of entry.
11. Our attention was drawn to a judgment of the Bombay High Court in the case of Chowgule & Co. Pvt. Ltd. v. Union of India and Ors. . It was contended on the strength of this judgment that the wordings of Section 46 and in particular the expression "shall make entry thereof by presenting to the proper officer a bill of entry for home consumption or warehousing in the prescribed form" make it appear at the first glance that the filing of the bill of entry in the prescribed form was mandatory and that, therefore, non-compliance thereof may make the importer liable to the penalty. This view, however, overlooked that presentation of a bill of entry in the prescribed form was only procedural, non-compliance of which could not be visited with penalty.
12. We do not have a case of penalty before us. We are also of the view that filing of a bill of entry in the prescribed form is not a procedural formality. Otherwise any importer may write a letter to the proper officer stating that certain quantities of goods have been imported and the goods will have to be cleared on the strength of the letter only. If a statutory form is prescribed for presentation of a bill of entry, then the bill of entry has to be in the prescribed form. Section 46(5) contemplates substitution of one bill of entry by another. The second bill of entry must also be prepared and lodged with the proper officer in the prescribed form. It cannot be said that the first application was in the prescribed form. No order could be passed upon it by the proper officer by treating it as a bill of entry for warehousing.
13. The second application of 26th August, 1985, accompanied by a bill of entry for warehousing, reached the Assistant Collector on 28th August, 1985 late in the day. We are of the view that the Tribunal has come to a correct decision in holding that the application could not possibly have been dealt with and disposed of then and there as soon as it was received. It was known on that date that the rates of tax were reduced. To allow substitution of the bill of entry as prayed by the appellant would have caused loss of revenue. This application was rightly rejected.
14. The appeal is dismissed. There will be no order as to costs.