2017 (8) TMI 1030 - HC - Customs

Court Upholds Customs Act Penalty, Rejects Agent's Challenge

M/s. Shaw Wallace Co. Ltd. Versus Union of India, The Deputy Commissioner of Customs, Marine Container Services (South) Pvt. Ltd.

The court upheld the communication directing payment of a shortlanding penalty under the Customs Act, ruling against the petitioner, a Steamer Agent. ... Principles of Constructive resjudicata - Goods not unloaded - The main line operator has instructed the petitioner by telex dated 22.02.1994 to reship the containers back to Singapore as per the instructions of the shippers at Seoul, Korea - demand of duty with penalty - Held that: - the present writ petition is liable to be dismissed on the sole ground of constructive resjudicata. The petitioner had filed the earlier writ petition to set aside the order passed by the Original Authority, the Appellate Authority and the Revisional Authority, which was dismissed by order dated 07.07.2004 - There is a legal presumption that when the petitioner challenges the validity of an order before the Court of law or before the statutory Appellate Authority, it is presumed that all contentions have been canvassed and the Court or the Authority having rejected the challenge a second round of challenge to the same processings is not maintainable. There cannot be a piecemeal challenge especially when impugned communication is not an order, but it is only an intimation to the petitioner to pay the shortlanding charges based on an order which has attained finality - petition dismissed - decided against petitioner. Issues:Challenge to communication directing payment of shortlanding penalty under Customs Act.Analysis:1. The petitioner, a Steamer Agent, challenged a communication directing payment of shortlanding penalty under the Customs Act. The petitioner was instructed to reship containers back to Singapore, resulting in a penalty notice for goods not unloaded and duty levied. The adjudicating Officer imposed a penalty of Rs. 33,64,762 on the petitioner.2. The petitioner appealed to the Commissioner of Customs, who set aside the order and remanded the matter for denovo examination. The petitioner then filed a revision petition to the Central Government, which was rejected. Subsequently, a writ petition was filed challenging these orders, which was dismissed on 07.07.2004.3. The impugned communication post the dismissal of the writ petition demanded payment of the shortlanding penalty. The petitioner contended that the respondents lacked jurisdiction to demand the penalty, citing Section 122 of the Customs Act. The petitioner's counsel referred to a previous case to support their argument.4. The court noted that the earlier writ petition's findings had finality, binding the petitioner. The court held that the petitioner's attempt to challenge the settled issue was not maintainable. It emphasized that challenging an order before a court or authority presumes all contentions were addressed, making a second challenge impermissible.5. The court concluded that the impugned communication did not provide fresh cause of action as it was based on an order with finality. It deemed the current writ petition devoid of merit and dismissed it, highlighting that the petitioner's actions aimed to delay the revenue claim. The court ruled in favor of the respondents, closing the case without costs.