The High Court allowed the petitioner to deposit ₹30 lakhs instead of ₹50 lakhs directed by the appellate authority, which would then entertain the appeal on merits and dispose of it.
Petitioner directed to deposit ₹30 lakhs within two months instead of ₹50 lakhs to entertain the appeal.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE
TUESDAY, THE 28TH DAY OF JUNE 2016/7TH ASHADHA, 1938
WP(C).No. 843 of 2015 (E)
PETITIONER(S):
M/S INTEGRAL TRADERS, REPRESENTED BY PROPRIETOR, VATHAKKAL LINE, EDAVANAKKAD, ERNAKULAM-682 502.
BY ADVS.SRI.P.RADHAKRISHNAN (1) SRI.MADHU RADHAKRISHNAN SRI.NELSON JOSEPH SRI.M.D.JOSEPH
RESPONDENT(S):
THE COMMISSIONER OF CUSTOMS, CUSTOM HOUSE, COCHIN-682 009.
BY ADV. SRI.THOMAS MATHEW NELLIMOOTTIL,SC
THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 28-06-2016, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:
PJ
WP(C).No. 843 of 2015 (E)
APPENDIX
PETITIONER(S)' EXHIBITS
EXHIBIT P9: TRUE COPY FO THE INCOME TAX RETURNS FOR THE YEAR 2014-2015. EXHIBIT P10: TRUE COPY OF THE MISCELLANEOUS ORDER NO:22385/2014 PASSED BY THE CESTAT DATED 22.9.2014.
RESPONDENT(S)' EXHIBITS
NIL.
/ TRUE COPY /
P.S. TO JUDGE
PJ
A.M. SHAFFIQUE, J.
------------------------------------- W.P.(C) No. 843 of 2015
Dated this the 28th day of June, 2016
JUDGMENT
Petitioner challenges Ext.P10 by which he is called upon to deposit Rs.50 lakhs within twelve weeks and report compliance on or before 15.1.2015 in order to entertain the appeal. The order is passed in an application submitted by the petitioner for waiver for predeposit for entertaining the appeal. Petitioner had preferred an appeal before the Appellate Tribunal, in regard to claim for differential customs duty of Rs.1,96,57,499/- and penalty of more than Rs.1 Crore 72 lakhs. The Appellate Authority while considering the application for waiver for redeposit, observed that the Revenue has made out a strong case in favour of the demand and at least in respect of approximately Rs.86,00,000/-, the demand is sustainable. Taking into consideration the aforesaid facts, the direction was issued to make a predeposit of Rs.50 lakhs.
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issues pertaining to the respective contentions of the petitioner has not been considered in detail by the appellate authority while directing remittance of Rs.50 lakhs. Petitioner being a small trader, has severe financial difficulty and is unable to remit the amount as directed.
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lakhs is concerned.
having perused the records, in regard to the question of maintainability, I do not think that this Court will be justified in conducting an enquiry regarding the maintainability of the writ petition at this stage, especially when the writ petition has been admitted as early as on 19.1.2015 and an interim direction had been issued by this Court, not to reject the appeal during the pendency of this writ petition.
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Rs.86 lakhs is concerned. Paragraph 6 of the order, is
relevant, which reads as under:
“6. After considering the submissions and the impugned order and the submissions of the learned AR, we find that in respect of nine Bills of Entry, it may be said that Revenue has been able to show that the actual transaction value i.e. the payment made for the consignments received to the exporter abroad is more than what was declared and excess amounts were transferred by other means. The fact that there was no evidence to show that exporter had received the money or the methodology followed for transfer of money and there is no evidence for that, does not mean that appellant had not paid excess amount in addition to what was declared to the customs department. If all the transactions were to be recorded and kept available for recovery, by the officers, investigating officers work would have been very simple. The evidence can never be 100% accurate or there can never be 100% proof. In our opinion, the department has been able to show that transaction value was more than what was declared by producing supporting evidences and by applying principle of preponderance of probability it can be definitely stated that the transaction value was more than what was declared. As regards valuation, once transaction value is available, the question of resorting
W.P.(C) No. 843 of 2015
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to contemporaneous value does not arise. In view of the above we consider that the Revenue has made out a strong case in favour of the demand and at least in respect of approximately 86,00,000/- the demand is₹ sustainable. At this stage the learned counsel submits that appellant is a small trader and is facing serious financial difficulties and produces income tax returns in support of the same which show negligible income for the appellant. He submits that the appellant has stopped import and export business and has no resources. We do not expect a person who has evaded tax to bring all his assets in to books of accounts in view of the fact that whatever value was paid over and above the amount declared was illegal and could not have been brought tinto account at all. In illegal transactions, the money earned is never reflected totally. Nevertheless in this case, invoice value has been under-declared and payments are in black, the profit earned within India if properly accounted increases and therefore the financial position indicated cannot be totally disbelieved. In any case when such malafide actions are undertaken, accounts are also not properly maintained and therefore the submissions with regard to financial difficulty have to be taken with a spoon of salt. Moreover, the income tax returns do not show the assets but only the income liable to tax. Nevertheless we take into consideration the financial difficulties also and therefore even though
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the appellants should have been required to deposit the entire amount of customs duty with interest and a portion of the penalty, we consider that if the appellant deposits an amount of 5,00,000- (rupees fifty lakhs₹ only) within twelve weeks and reports compliance on 15.01.2015, that would be sufficient for hearing the appeal. Accordingly, if the amount is deposited as mentioned above and compliance reported, the requirement of predeposit of balance dues is waived and stay against recovery is granted during the pendency of appeal.”
6. On a bare reading of the aforesaid order would
clearly indicate that there is no infirmity or perversity for this Court to interfere with the impugned order.
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submits that compared to the total amount involved, the amount directed to be deposited is reasonable. That apart, the sustainability of the writ petition itself is in question. At this stage, it may not be proper for this Court to interfere with the direction to deposit Rs.50 lakhs.
In the said circumstances, taking into consideration an overall view of the matter, especially, the contentions urged on
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merits, I am of the view that it would suffice that the petitioner deposits an amount of Rs.30 lakhs instead of Rs.50 lakhs. This shall be done within two months from the date of receipt of a copy of this judgment. On such deposit, the appellate authority shall consider the appeal on merits and dispose of the same in accordance with law.
Writ petition is disposed of as above.
Sd/A.M. SHAFFIQUE JUDGE
Scl/28.06.2016
2 issues framed by the court
Whether the petitioner can be directed to pay a reduced amount instead of the directed ₹50 lakhs to entertain the appeal.
Whether the appellate authority arbitrarily directed a predeposit of ₹50 lakhs without considering the petitioner's financial constraints.
M/S INTEGRAL TRADERS
THE COMMISSIONER OF CUSTOMS
A.M. SHAFFIQUE
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
