2003 (3) TMI 568 - Commission - Customs

Commission finds Core Healthcare Ltd. unable to pay duty despite partial payment; cases to proceed under Customs Act.

IN RE: CORE HEALTH CARE LIMITED (I) & (II)

IN RE: CORE HEALTH CARE LIMITED (I) & (II) - 2003 (160) E.L.T. 953 (Sett.comm.) Issues:Settlement of duty liability by M/s. Core Healthcare Ltd. before the Settlement Commission regarding two applications, non-payment of installments, impact of a notice under the Securitisation Act by ICICI Bank, applicant's plea for adjournment, Revenue's request to send the case back for further action.Settlement of Duty Liability:The judgment involves the disposal of two applications by M/s. Core Healthcare Ltd. disclosing a total duty liability of approximately Rs. 27.89 Crores. The applicant had paid Rs. 16.65 Crores towards the liability in installments, leaving a balance of Rs. 11.24 Crores. The applicant's financial position was analyzed, indicating a net loss and lack of available funds to liquidate the duty liability.Impact of Securitisation Act Notice:ICICI Bank had issued a notice under Section 13(2) of the Securitisation Act to recover dues aggregating to Rs. 352.48 crores from the applicant. The Act required the applicant to discharge full liabilities to the secured creditor within 60 days, failing which the creditor could take measures for debt recovery. The judgment discussed the implications of the Act on the applicant's financial obligations.Applicant's Plea for Adjournment:M/s. Core Healthcare Ltd. requested an adjournment of the final hearing until June 30, 2003, citing expectations of fulfilling obligations towards suppliers and projecting sales for 2002-03. The applicant aimed to start paying the balance installments post-June/July 2003, seeking time for a positive resolution of its financial position.Revenue's Request for Further Action:The Revenue, represented by an Appraiser, proposed sending the case back for appropriate action since the applicant was not complying with the Commission's orders. The judgment deliberated on the applicant's default in payment and the potential consequences of non-compliance.Conclusion:The Commission analyzed the applicant's assertions regarding the impact of ICICI Bank taking over assets and the applicant's ability to generate funds for duty liability. It found the applicant's pleas unsubstantiated, indicating the lack of capacity to pay the balance duty amount. Due to the applicant's default in payments and inability to cooperate, the cases were to be returned to the proper officer for disposal under the Customs Act, as if no application under Section 127B was made. This decision was based on the applicant's financial constraints and non-cooperation, leading to the conclusion that the applicant lacked the means to settle the duty liability.