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of <h1>Court quashes duty payment demands for lack of due process</h1> <h3>Haryana Sheet Glass Limited Versus Union of India</h3> The court quashed three communications demanding duty payment due to the absence of a show cause notice or adjudication order. The petitioner's paid ... - Issues involved: The judgment involves a demand for payment of a differential duty amount without issuance of a show cause notice or adjudication order, leading to the quashing of three communications and the return of the amount paid by the petitioner.Judgment Details:Issue 1: Interim Relief and Payment DemandThe petitioner was directed to deposit a sum of Rs. 1,30,00,000/- and another sum of Rs. 1,00,00,000/- against a demand of Rs. 6,76,07,490/-. The court noted the need for a bank guarantee or security for the remaining amount and expressed satisfaction that the petitioner could not have been asked to pay the full amount without due process.Issue 2: Demand QuantificationThe demand for payment of a differential duty amount was quantified at Rs. 6,76,07,490/- through communications dated 5.9.1997 and 14.10.1997, without issuance of a show cause notice or adjudication order.Issue 3: Lack of Show Cause NoticeThe petitioner contended that the demand for duty was made without issuing a show cause notice or adjudication order, while requests for extension of gestation period and conversion from EOU to EPCG were pending. The court referenced previous judgments emphasizing the necessity of a show cause notice under Section 11A.Issue 4: Legal PrecedentsCiting the case of Commissioner of Central Excise v. Akay Cosmetics Pvt. Ltd., the court highlighted the requirement of a show cause notice under Section 11A for demanding differential duty, emphasizing the invalidity of demands made without prior notice.Issue 5: Quashing of CommunicationsIn light of the legal position and absence of show cause notice and adjudication, the court quashed the three communications demanding duty. The amount paid by the petitioner was ordered to be returned, and the court refrained from delving into the merits of the controversy due to the lack of a show cause notice.Issue 6: Judgment and CostsThe petition was allowed, the rule was made absolute, and no costs were imposed in the matter.This judgment highlights the importance of due process in demanding duty payments and sets a precedent for the necessity of issuing show cause notices before imposing such financial obligations on parties involved in customs matters.
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