Gujarat HC Directs Department to Finalise Assessment within Two Months

The Gujarat High Court has recently directed the Goods and Services Tax (GST) and Central Excise departments to complete the final assessment proceedings and release the applicant’s Bank Guarantees (BGs) within two months.

The applicant has also pointed out that they have incurred a loss of Rs 96,87,616 due to the bank guarantee charges and claimed compensation in its writ application.

The Court observed that the Deputy Commissioner of Customs sent an intimation to the Assistant Commissioner in October 2012, stating that the Bills of Entry (BoE) need to be assessed. The applicant also sent a reminder in 2018 to the Assistant Commissioner requesting to finalise the assessment as there was an abnormal delay in carrying out the procedure.

The applicant sent a further notice to the Commissioner CGST highlighting the delay caused in assessing the BoEs since they have provisionally consumed the goods imported between 1995 to 1997. Also, they have been used for manufacturing finished goods.

The applicant also submitted that they had to extend the bank guarantees worth Rs 4,23,37,569 until date since its issuance in 1995 and 1996. Due to this, the applicant had to bear bank guarantee charges worth Rs 96,87,616.

Using its EPCG license, the applicant imported various items between 1995 to 1997, for which the authorities have provisionally assessed the BoEs and cleared the goods for consumption. However, the BoEs awaited the final assessment.

The company had to execute bonds worth Rs 4,18,88,085 and Rs 4,49,484 as security for imports. Also, the Customs Authorities had failed to refund Rs 32,11,115, apart from the bank guarantees of Rs 4,49,484.

After hearing the contentions, the High Court expressed concern about the delay in finalising the assessment proceedings. Accordingly, the Court issued the deadline of two months while permitting the Assistant Commissioner to approach the applicant for documentation during the finalisation process.

For any clarifications/feedback on the topic, please contact the writer at dvsr.anjaneyulu@cleartax.in