2018 (10) TMI 1769 - HC - Customs

High Court rules on challenge to Customs Commissioner's order on Incentive Scheme, emphasizes fairness in exclusion decisions

M/s. Tube Investments of India Ltd. Versus Union of India And The Commissioner of Customs, Tiruchirapalli.

The High Court of Madras addressed a case challenging the Commissioner of Customs' order on the Status Holder Incentive Scheme. The petitioner, an ... Status Holder Incentive Scheme - exemption granted to specified capital goods imported from various ports across the Country - grievances of the writ petitioner is that almost majority of the ports across the Country are named in the notification. However, the Port at ICD, Arakkonam, has not been included in the list of Ports. Thus, the benefit of incentives introduced by the Government of India had not been extended to the writ petitioner, while importing capital goods. HELD THAT:- When the importers of other ports and ICD, are availing the benefit of incentive scheme, importers of particular port cannot be denied such a benefit. Such a discrimination, if at all must be substantiated by the respondents. However,the learned counsel appearing for the respondents is unable to provide any convincing reasons for the purpose of exclusion of ICD Arakkonam, from the list of ports incorporated in the scheme. This apart, the case of the writ petitioner was considered favorably by the authorities competent from the year 2014 onwards. As of now, the writ petitioner is availing the benefit of scheme and there was no objection at all. Thus, the five import transactions already done also deserve to be considered favorably based on the representation submitted by the writ petitioner. In view of the fact that the respondents have not furnished any candid reason for the purpose of non-inclusion of the ICD, Arakkonam in the list of scheme, the case of the writ petitioner deserves consideration on the hands of the respondents themselves. The writ petitioner is directed to submit a fresh representation setting out all the facts, details and documents within a period of three weeks from the date of receipt of a copy of this order - impugned order set aside - petition allowed. Issues involved:1. Challenge to order issued by Commissioner of Customs regarding Status Holder Incentive Scheme.2. Non-inclusion of ICD, Arakkonam in the list of ports for incentive scheme.3. Rejection of claim for retrospective benefit by Commissioner of Customs.4. Allegation of discrimination against importers at ICD, Arakkonam.5. Competence of Commissioner to grant post permission for import transactions.6. Lack of reasons provided for exclusion of ICD, Arakkonam from the scheme.Comprehensive Analysis:The High Court of Madras addressed multiple issues in a case challenging the order issued by the Commissioner of Customs regarding the Status Holder Incentive Scheme. The petitioner, engaged in importing capital goods for manufacturing various products, raised concerns over the non-inclusion of ICD, Arakkonam in the list of ports eligible for incentives under the scheme. The petitioner argued that while most ports were named in the notification, ICD, Arakkonam was omitted, leading to the denial of benefits for their import transactions. The petitioner sought retrospective extension of the scheme's benefits, but the Commissioner rejected this request, citing that benefits could only be granted prospectively. The Court noted the absence of reasons for excluding ICD, Arakkonam from the scheme, highlighting a potential case of discrimination against importers at that port.Furthermore, the petitioner contended that the Commissioner had the authority to grant post permission for import transactions, including those prior to the scheme's implementation. The Court emphasized the need for providing reasons for excluding a particular port from the scheme, which the respondents failed to do. Despite the lack of a specific discrimination claim in the petition, the Court considered all legal grounds during the hearing. It was noted that other importers were benefiting from the scheme, underscoring the need for justifying the exclusion of ICD, Arakkonam. The Court directed the petitioner to submit a fresh representation with all relevant details, documents, and facts for reconsideration by the authorities, emphasizing a fair and merit-based decision-making process.In conclusion, the High Court set aside the Commissioner's order and directed a reevaluation of the petitioner's case in light of the observations made. The Court instructed the authorities to consider the fresh representation within a specified timeframe and temporarily suspended any adverse actions against the petitioner until a decision was reached. The writ petitions were disposed of, and connected miscellaneous petitions were closed, ensuring a fair and transparent review process for the petitioner's benefit under the Status Holder Incentive Scheme.