The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad bench upheld anti-dumping duty and related IGST demands on stainless steel imports from China, but reduced the importer’s penalty from ₹4 lakh to ₹1 lakh.
The bench of Dr. Ajaya Krishna Vishvesha (Judicial Member) and Satendra Vikram Singh (Technical Member) has observed that customs authorities can issue a demand notice under Section 28 of the Customs Act to recover duty left unpaid at the time of self-assessment. The department need not first appeal against the self-assessment of the imported goods.
Buy Now: 100+ Judgements On Customs Classification
The ruling arose from an appeal by the appellant/assessee concerning two consignments of cold-rolled flat stainless steel products imported from China in January and May 2019. The goods were cleared for home consumption after self-assessment. On later scrutiny, the department found that the anti-dumping duty at 57.39% under Notification No. 61/2015-Cus (ADD) had not been paid.
The department issued a show-cause notice in January 2021 seeking ₹20,95,712 in anti-dumping duty and ₹3,77,228 in IGST, along with interest. The adjudicating authority confirmed those demands and imposed a ₹4 lakh penalty under Section 117 of the Customs Act. The Commissioner (Appeals) upheld the order, prompting Famous Steel to approach the Tribunal.
The assessee argued that self-assessment was an appealable assessment order. Relying principally on the Supreme Court’s decision in ITC Ltd., it submitted that the department could not reopen that assessment through a demand notice without first challenging it in appeal.
The Tribunal rejected that argument. It explained that the ITC Ltd. ruling concerned a refund claim under Section 27 of the Customs Act: a refund proceeding cannot be used to reassess an unchanged bill of entry. The present dispute concerned the recovery of duty not paid, for which Section 28 provides a separate procedure.
The bench held that the department could therefore issue a Section 28 notice for differential customs duty without first appealing against the importer’s self-assessment.
The importer also challenged the IGST demand, contending that IGST was not a customs duty recoverable under Section 28.
The Tribunal held that anti-dumping duty levied under Section 9A of the Customs Tariff Act forms part of customs duty for the purpose of the applicable provisions. Reading those provisions with the rules for calculating IGST on imported goods, it concluded that IGST was payable on the anti-dumping duty that had been omitted at self-assessment.
It accordingly upheld the demands of ₹20,95,712 in anti-dumping duty and ₹3,77,228 in IGST, together with applicable interest.
The importer succeeded on the penalty amount. The Tribunal noted that both imports took place before 1 August 2019, when the maximum penalty under Section 117 was ₹1 lakh. The ceiling was raised to ₹4 lakh only from that date. A ₹4 lakh penalty could not therefore be imposed for the earlier imports.
Reducing the penalty to ₹1 lakh while upholding the duty, IGST and interest demands, the Tribunal partly allowed the appeal.
Membership Required to Access Case Details & Order Copy
To view the complete Case Details and Download Order Copy, you must have an active membership. Please subscribe to continue.
Read More: 2 Year Excise Notice Limit Can’t Revive Time-Barred Greenhouse Duty Demand: CESTAT
