Appeal dismissed as show-cause notices failed to attribute alleged infraction to licence transferor, so lower findings sustained

The SC dismissed the appeal, upholding the CESTAT and HC decisions, because the show-cause notices failed to attribute any alleged infraction to the transferor of the licence. Given absence of reference to the transferor in the notices, the lower tribunals' findings were sustained and no interference warranted.

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Issues:
Challenge to order upholding CESTAT's decision on DEPB licenses; Liability under Customs Act; Barred by limitation; Role of respondent in show cause notice.

Analysis:
The appeal before the Supreme Court challenged the order of the Punjab & Haryana High Court, which upheld the decision of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) dismissing the appellant's appeal. The appellant had acquired transferable Duty Entitlement Pass Book (DEPB) licenses, and was issued show cause notices for recovery of a specific amount under the Customs Act, 1962. The Commissioner of Customs confirmed the demand, holding both the original license holder and the appellant jointly liable. The Tribunal allowed the respondent's appeal, citing limitation as a bar to the demand, a decision upheld by the High Court.

The main contention in the appeal was the absence of any reference to the alleged infraction by the original license holder, M/s. Parker Industries, in the show cause notices. The Supreme Court noted that since the notices did not mention any wrongdoing by M/s. Parker Industries, the decisions of CESTAT and the High Court were found to be legally sound. The Court referred to a previous judgment in Commissioner of Customs (Import) Bombay v. M/s. HICO Enterprises, where a similar view was taken, further supporting the dismissal of the appeal challenging the liability under the Customs Act.

In conclusion, the Supreme Court dismissed the appeal, affirming the decisions of CESTAT and the High Court, as there was no legal basis to interfere with the findings regarding the liability under the Customs Act. The absence of any reference to the alleged infraction by the transferor of the license in the show cause notices was a crucial factor in upholding the lower courts' decisions.

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