2016 (11) TMI 134 - HC - Customs

Invalid show-cause notice under Customs Act set aside by High Court, emphasizing proper assessment procedures.

The High Court of Calcutta ruled in a case challenging a show-cause notice issued under the Customs Act, 1962. The Court found the notice invalid as it ... Misdeclaration - Confiscation - The petitioner has challenged issuance of show-cause notice dated 20th March, 2010 under section 124 read with section 28 of the Customs Act, 1962 as in excess of the power and jurisdiction of the issuing authority - Final assessment not having been made, there cannot be issuance of a show-cause notice under the said section within the period prescribed from the relevant date, since there is no relevant date in the present case as final assessment and adjustment has not been made - Held that: - The discovery made by Customs recording mis-declaration might give rise to issuance of a show-cause notice to that effect but the present show-cause notice cannot be sustained - Decided in favor of the assessee. Issues:Challenge to show-cause notice under Customs Act, 1962Analysis:The petitioner challenged the issuance of a show-cause notice dated 20th March, 2010 under section 124 read with section 28 of the Customs Act, 1962, claiming it exceeded the power and jurisdiction of the issuing authority. The petitioner's advocate referred to a previous order directing the final assessment of imported goods, highlighting that final assessment had not been completed by the proper officer. The advocate argued that since final assessment had not been made, the provisions of section 124 could not be applied. The Customs advocate contended that the show-cause notice was issued due to a discovered mis-declaration by the petitioner, as admitted in the order dated 1st April, 2010. However, the Court found the show-cause notice to be misconceived given the circumstances. While acknowledging that a mis-declaration could lead to a show-cause notice, the Court ruled that the present notice could not be sustained. Consequently, the impugned notice was set aside, and any subsequent orders based on it were deemed invalid.This judgment by the High Court of Calcutta addressed the challenge to a show-cause notice issued under the Customs Act, 1962. The Court examined the arguments presented by both the petitioner and the Customs department. The petitioner's advocate emphasized the lack of final assessment of imported goods by the proper officer, questioning the application of section 124 in the absence of such assessment. On the other hand, the Customs advocate pointed out a mis-declaration by the petitioner as the reason for issuing the show-cause notice. Despite the admission of mis-declaration, the Court found the show-cause notice to be legally unsustainable in the given circumstances. As a result, the Court set aside the impugned notice and invalidated any subsequent orders based on it. This comprehensive analysis highlights the legal intricacies involved in challenging a show-cause notice under the Customs Act, emphasizing the importance of proper assessment procedures and legal justifications for such notices.