2016 (11) TMI 1083 - HC - Customs

High Court allows Writ Petitions on Customs Act Settlement Applications, setting aside one condition.

M/s Shree Ganesh Enterprises, Ms Deepali Poojari Versus Union of India And Others

The High Court ruled in favor of the Petitioners, finding that two out of three conditions for admissibility of Settlement Applications under the Customs ... Validity of order passed by Settlement Commission - the Bill of Entry filed before the issuance of the SCN - violation of condition as set out in 1st Proviso to section 127B(1) of the Customs Act, 1962 - Held that: - reliance placed in the decision of the case of M/s Auto Creaters v/s Union of India and others [2016 (11) TMI 855 - BOMBAY HIGH COURT], where it was already held that Condition No.(iii) was complied with by the said M/s Auto Creaters. As the facts in these Writ Petitions are almost identical to the one filed by M/s. Auto Creaters, these Writ Petitions also succeed and are allowed in terms of prayer clause (b). Rule is made absolute in the aforesaid terms. The Settlement Applications filed by the Petitioners are restored to the file of Respondent No.4 for a de novo consideration - petition disposed off. Issues:Challenge to rejection of Settlement Application by Settlement Commission under Customs Act, 1962 based on fulfillment of conditions.Analysis:The High Court of Bombay heard Writ Petitions challenging the rejection of Settlement Applications by the Settlement Commission under the Customs Act, 1962. The Settlement Commission examined three conditions to decide the admissibility of the Settlement Application. Condition (i) pertained to whether the Application was in respect of a 'case' as defined in section 127A of the Customs Act, 1962. Condition (ii) focused on whether the Applicant had paid the additional admitted duty liability along with interest as required by section 127B of the Act. Condition (iii) required the filing of a Bill of Entry before the issuance of the Show Cause Notice, as stipulated in section 127B of the Act.The Settlement Commission ruled in favor of the Petitioners regarding Conditions (i) and (ii). However, it found that Condition (iii) was not fulfilled as the necessary bill of entry had not been filed before the Show Cause Notice was issued. In a companion Writ Petition, the Court had previously held that Condition (iii) was met by another party. Given the similarity in facts between the cases, the Court allowed the current Writ Petitions, restoring the Settlement Applications to the Commission for a fresh consideration based on the reasoning provided in the previous judgment. The Petitioners were successful in their challenge, and the Court made the rule absolute without any order as to costs.