S. K. Brothers Vs Commissioner of Customs (CESTAT Chandigarh)
Summary: CESTAT Chandigarh allowed five appeals filed by S.K. Brothers, Sanjeevani Foods Pvt Ltd and TLG Overseas, holding that demands raised under Section 28 of the Customs Act, 1962 were premature because the provisional assessments had not been finalised. The appellants had exported parboiled rice under CTH 10063010 after samples were drawn and sent to CRCL, New Delhi, pursuant to Instruction No. 29/2022-Customs dated 29.10.2022. The goods were allowed for export provisionally upon execution of bonds under Section 18. CRCL reports subsequently indicated characteristics of non-parboiled rice, leading the department to view the goods as classifiable under CTH 10063090 and to allege export duty liability at 20%, along with interest, redemption fine and penalties. The Tribunal found that the bonds clearly demonstrated provisional assessment under Section 18 and that Regulation 5 of the Customs (Finalization of Provisional Assessment) Regulations, 2018 required finalisation within two months from receipt of the test reports. Since final assessment had not been carried out, proceedings under Section 28 were held premature. The Tribunal also found that the CRCL reports did not definitively determine the nature of the exported rice and that the requested cross-examination of the Chemical Examiner had not been considered. It did not record a final finding on classification. Since the goods had already been exported and were unavailable for confiscation, the redemption fine and penalties were also set aside. The impugned orders were consequently set aside and the appeals were allowed with consequential relief, if any, in accordance with law.
Cases Discussed
- Saharsh Distributors Pvt Ltd vs. Commissioner of Customs, New Delhi – 2017 (354) E.L.T. 671 (Tri. – Del.)
- Commissioner of Central Excise & Customs, Mumbai vs. ITC Ltd – 2006 (203) E.L.T. 532 (S.C.).
- TGV SRAAC Ltd vs. Commissioner of Customs, Chennai – (2026) 43 Centax 84 (Tri. Mad.)
- Commissioner of Customs vs. Canon India Pvt Ltd – (2024) 24 Centax 117 (SC)
- Commissioner of Customs, Amritsar vs. M/s Raja Impex (P) Ltd – 2008 (229) E.L.T. 185 (P&H)
FULL TEXT OF THE CESTAT CHANDIGARH ORDER
