The High Court of Madras dismissed a writ petition challenging a Settlement Commission order waiving interest on smuggled scrap. The Court held that section 127H empowers the Commission to grant immunity from interest and that sections 28AA/28AB were inapplicable here.
Writ petition dismissed; no costs.
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 JUDICATURE AT MADRAS
DATED: 05.01.2017
CORAM:
THE HONOURABLE Dr. JUSTICE ANITA SUMANTH
W.P.No.21108 OF 2002
Union of India rep. by the Commissioner of Customs,
No.33, Rajaji Salai, Customs House, Chennai – 600 001. .. Petitioner Vs.
Writ Petition filed under Article 226 of the Constitution of India praying for issuance of a Writ of Certiorari to call for the records relating to the order dated 23.05.2001 in 4/2001SC passed by the second respondent and to quash the same.
For Petitioner : Mr.P.Mahadevan
For Respondents: Mr. N.Inbarajan – R1
No appearance – R2 ORDER
This Writ Petition is filed by the Commissioner of Customs challenging an order of the Customs and Central Excise Settlement Commissioner dated 23.5.2001.
shredded scrap clearing the same without payment of duty on the strength of a value based Advance Licence bearing No.35435 dated 11.5.93. The exemption was subject to the fulfilment of export obligations. The petitioner, the Commissioner of Customs, was of the view that the export obligation remained unfulfilled and issued a show cause notice to the assessee calling upon it to show cause why liability not be fastened for duty of an amount of Rs.24,02,431/- along with interest at the rate of 24% per annum from the date of import up to the date of payment. Upon receipt of the show cause notice, the assessee filed an application before the Customs and Central Excise Settlement Commission (in short 'Settlement Commission') for settlement of the case.
'1. The duty liability payable by the applicant is fixed at Rs.22,42,269/-. As the applicant has already paid the said amount though in instalments, the same is adjusted against the above duty liability.
'Power of Settlement Commission to grant immunity from prosecution and penalty. - (1) The Settlement Commission may, if it is satisfied that any person who made the https://hcservices.ecourts.gov.in/hcservices/ application for settlement under section 127B
has co-operated with the Settlement Commission in the proceedings before it and has made a full and true disclosure of his duty liability, grant to such person, subject to such conditions as it may think fit to impose, immunity from prosecution for any offence Central Act for the time being in force and also either wholly or in part from the imposition of any penalty, fine and interest under this Act, with respect to the case covered by the settlement :
Provided that no such immunity shall be granted by the Settlement Commission in cases where the proceedings for the prosecution for any such offence have been instituted before the date of receipt of the application under section 127B.
(2) An immunity granted to a person under sub-section (1) shall stand withdrawn if such person fails to pay any sum specified in the order of the settlement passed under such sub-section (7) of section 127C within the time specified in such order or within such further time as may be allowed by the Settlement Commission, or fails to comply with any other condition subject to which the immunity was granted and thereupon the provisions of this Act shall apply as if such immunity had been granted.
(3) An immunity granted to a person under sub-section (1) may, at any time, be withdrawn by the Settlement Commission, if it is satisfied that such person had, in the course of the settlement proceedings, concealed any particulars, material to the settlement or had given false evidence, and thereupon such person may be tried for the offence with respect to which the immunity was granted or for any other offence of which he appears to have been guilty in connection with the settlement and shall also become liable to the imposition of any penalty under this Act to which such person would have been liable, had no such immunity been granted.'
“........
https://hcservices.ecourts.gov.in/hcservices/ (b) makes a declaration before the Assistant
Collector of Customs binding himself to pay on demand an amount equal to the duty leviable but of the exemption, on the imported materials in respect of which the conditions specified in this notification have not been complied with:”
SHOW CAUSE NOTICE Sub:- Duty Free Imports under Value Based Licence No.35486/1/01/10/1/95 dated 11.5.93 (DEEC No.76108 dt.11.5.93) issued by JDGFT, Chennai – recovery of customs duty – reg. ***** Valued Based Advance Licence No.P/L/35486 dt. 11.5.93 along with DEEC No.76108 dt 11.5.95 was issued by JDGET, Madras. The said Licence was issued against an export obligation of 2000 MT of Steel Rods for a value of Rs.1,98,45,000/-
has been no determination of duty as the matter was at the stage of show cause notice when the assessee approached the Settlement Commission.
2 issues framed by the court
Whether the Settlement Commission had the authority under section 127H of the Customs Act to waive interest.
Whether sections 28AA and 28AB of the Customs Act apply to cases settled under Chapter XIV A.
Colour shows how this judgement treated each authority
N.A.Referred
4 provisions across 1 enactments
Union of India rep. by the Commissioner of Customs
M/s.Ganapathy Smelters Limited
The Registrar, Office of the Settlement Commission
Anita Sumanth
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
