Section 154 of Customs Act:Incorrect filing of Bill of Entry

Section 154 of Customs Act:Incorrect filing of Bill of Entry:

I am sharing with you a brief synopsis of an important ruling by the two judges bench of Madras High Court in the case of M/s Symrise Pvt. Ltd. v. Commissioner of Customs (Imports) 2019-TIOL-776-HC-MAD-CUS wherein it is held that Section 154 of the Customs Act, 1962 does not in any manner restricts the exercise of power of the officer, when a clerical or arithmetical mistake is pointed out by the importer or exporter for reasons attributable to the importer or exporter.

Section 154 reads as “Clerical or arithmetical mistakes in any decision or order passed by the Central Government, the Board or any officer of customs under this Act, or errors arising therein from any accidental slip or omission may, at any time, be corrected by the Central Government, the Board or such officer of customs or the successor in office of such offic­er, as the case may be”.

The facts of the case were that, in a particular bill of entry, the duty was assessed on the amount covered by nine invoices. However, out of these nine invoices, a particular invoice was already covered in a separate bill of entry and assessed accordingly. The assessee claimed that on the same invoice, duty has paid twice and therefore, duty amount paid in excess should be refunded.

In this regard, the assessee filed a review application for re-assessment of the bill of entry and grant of refund arising thereon as per Section 154 which was dismissed by Assessing Officer on the ground that the assessment order was not challenge by way of filing appeal (i.e. following the normal procedure provided in Section 128 of the Act). Thereafter, the assessee approached the Commissioner (Appeals) who dismissed the appeal stating that the error as per Section 154 could not be rectified unless it had been committed by the Department.

Then the assessee moved the Tribunal wherein it was held that any clerical error or arithmetical error could be rectified suo motu under Section 154 of the Act and refund could be allowed to importer as a consequence of correction of clerical error under Section 154 of the Act, when the importer had not filed refund claim under Section 27 of the Act. Thereafter, revenue filed the present appeal before the Hon’ble High Court.

Hon’ble Court in the present case referred and followed the ratio of CESTAT Mumbai Bench ruling in the case of M/s GOA SHIPYARD LTD (2005-TIOL-1578-CESTAT-MUM.). in which it was held that “refunds as a consequence of correction of clerical error under the independent provision of Section 154 is admissible without filing a refund claim under Section 27(1). We also note that Section 154 is a latter provision of law under which a correction can be made at any time. We further note that Section 27(1) has not been given over-riding effect over other sections of the Customs Act, 1962…”

Departing note: The ruling is very important in the sense that it give relief to various importers to file application before the officers as per Section 154 of the Customs Act, 1961. In many cases higher duty is paid due to incorrect filing of bill of entry inadvertently for any reason whatsoever (for ex: declaring a higher rate of foreign exchange) and therefore, higher duty is paid inadvertently. Accordingly, refund can be claimed for such higher duty paid.