Page 195 - ELT_1st August 2020_Vol 373_Part 3

2020 ] K. DHANDAPANI & CO. LTD. v. D.G.F.T., NEW DELHI 377

thority namely the Director-General of Foreign Trade. The bank guarantee also
was invoked by the office of the Director General of Foreign Trade.
40. The background of the facts that in which the above decision came
to be rendered has to be kept in mind. The said decision cannot be applied
straightaway. While considering the provisions of the Foreign Trade (Develop-
ment and Regulation) Act, 1992, the Export and Import Policy and the relevant
Handbook of Procedures, it has to be kept in mind that the customs duty under
Notification No. 160/92-Customs, dated 20-4-1992 was issued to implement the
Policy.
41. The Notification No. 160/92-Customs, dated 20-4-1992 was not in-
dependent of Export and Import Policy of the Ministry of Commerce. The peti-
tioners having agreed to bind to the conditions of the license issued in terms of
the Foreign Trade (Development And Regulation) Act, 1992, the Export and Im-
port Policy and the relevant Handbook of Procedure the Foreign Trade (Devel-
opment And Regulation) Act, 1992 cannot approbate and reprobate. Therefore, it
is not open for the petitioners to state that the Officers of the Ministry of Com-
merce have no power to levy of interest.
42. The decision of the Honourable Supreme Court in the case of Indian
Carbon Ltd. v. State of Assam, AIR 1997 SC 3054 is not applicable to the facts of the
present cases inasmuch as there the Court held that “there is no substantive provi-
sion in the Central Act requiring the payment of interest on Central Sales Tax.”
43. The appellants therein were a manufacturer and seller of petroleum
coke a declared under goods by Section 14 of the Central Sales Tax Act, 1956. The
appellants were liable to pay Central Sales Tax on the petroleum coke on inter-
State sales. However, the appellant delayed in payment of tax, the Assessment
Years 1974 to 1980 and was therefore called upon to pay interest at the rate of
24% per annum thereon, in purported exercise of the provisions of Section 35A of
the Assam Sales Tax Act, 1947 (17 of 1947). It was in the said background, the
said decision was rendered.
44. Though not cited, it is noticed that this issue has already answered
by the Honourable Supreme Court in Rexnord Electronics and Controls Limited v.
Union of India and Others, (2008) 12 SCC 156 = 2008 (224) E.L.T. 184 (S.C.), wherein
the Honourable Supreme Court has framed the following question :-
16. The core question which, therefore, arises for consideration is as to
whether the term “interest” used therein would include within its fold in-
terest payable under the bond furnished by the appellant before the Direc-
tor General of Foreign Trade.
45. In the above judgment, the Honourable Supreme Court has held as
under :-
25. The appellant having evaded payment of duty was bound to pay the
same and furthermore was bound to pay interest in terms of the bond exe-
cuted by it. The Settlement Commission, therefore, could not have given
any direction for deduction in regard thereto. As the Settlement Commis-
sion, did not have any jurisdiction to waive the amount of interest payable
under the bond, we do not see that any jurisdictional error has been com-
mitted by it in directing the payment of the said amount which is otherwise
payable. In any event the appellant is not prejudiced thereby as irrespective
of such direction, the appellant was bound to pay the interest payable un-
der the bond.
EXCISE LAW TIMES  1st August 2020  195