CESTAT Kolkata- Higher Customs Duty Held Unenforceable Due to Delay in Notification Publication

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Dated: 05.05.2025

CESTAT Kolkata- Higher Customs Duty Held Unenforceable Due to Delay in Notification Publication

The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Eastern Zonal Bench, Kolkata, ruled in favour of M/s Emami Agrotech Ltd. by setting aside the demand for differential customs duty on imported crude palm oil. The case involved a dispute over the applicable date for a notification that raised Basic Customs Duty (BCD) from 15% to 30%.

Case Background:

Emami imported crude palm oil in November 2017 via four Bills of Entry dated 16.11.2017.
Entry inward for the consignments was granted on 18.11.2017 and 19.11.2017.
Notification No. 87/2017-Customs dated 17.11.2017, which increased BCD to 30%, was only published in the Official Gazette on 20.11.2017.
Customs demanded higher duty based on the entry inward date.
Emami paid the higher duty under protest and later appealed the assessment.

Legal Arguments Raised by Emami:

Notification Ineffectiveness Before Gazette Publication:
- Under Section 25(1) of the Customs Act, a notification takes effect only from its official publication.
- Notification dated 17.11.2017 became effective only on 20.11.2017, hence not applicable to Emami’s consignments.
Customs’ Own Delay:
- Entry inward was delayed due to Customs’ administrative lapse, not due to any fault of the appellant.
- Documents and readiness were submitted on time (15.11.2017), and any delay in granting entry inward was unjustified.
Supportive Case Law Cited:
- Ruchi Soya Industries v. Union of India – High Courts held that notification must be published to be effective.
- GS Chatha Rice Mills v. Union of India – Supreme Court emphasized the primacy of publication date over issuance date.

Tribunal’s Observations:

Accepted that publication date (20.11.2017) is the effective date of the notification.
Noted that the entry inward was granted prior to publication, hence 15% BCD rate prevailed.
Reiterated that Customs cannot benefit from its own delay, as supported by Priyanka Overseas Ltd. and Northern Plastics Ltd..

Final Verdict:

Demand for differential duty of ₹12.33 crore set aside.
Appeal allowed in full with consequential relief.

Legal Significance:

This order clarifies that in customs matters, the date of notification publication—not issuance—determines its enforceability. Importers cannot be penalized for delays by authorities, and timely filings protect their legal rights.

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Source: CESTAT Kolkata

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