Court Dismisses Challenge to Duty Notice; Petitioners Given 30 Days to Respond

The court dismissed the petition challenging a Show Cause Notice demanding duty foregone at the time of importing capital goods, citing violation of Exemption Notification conditions and seeking penalty and interest under sections 112(a) and 111(o) of the Customs Act, 1962. The court found the petition lacking in merits, ruling that the notice was not time-barred despite the imports dating back to 2004. The petitioners were granted 30 days to respond to the notice, with the respondent mandated to adjudicate and issue orders within 90 days from receipt of the response.

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Issues involved: Challenge to impugned Show Cause Notice demanding duty foregone at the time of import of capital goods, violation of Exemption Notification conditions, time-barred Show Cause Notice, penalty and interest u/s 112(a) and 111(o) of the Customs Act 1962.

Summary:
The petitioners challenged the Show Cause Notice dated 28.12.2019 issued by the respondent demanding duty foregone at the time of import of capital goods under Bill of Entry No.673488 dated 24.08.2004, and to confiscate the capital goods for violating conditions of Exemption Notification No.55/03 dated 01.04.2003, along with penalty and interest u/s 112(a) and 111(o) of the Customs Act, 1962. The petitioners contended that the Show Cause Notice was time-barred as the imports were made in 2004 and the duty forgone was secured by a Bank Guarantee invoked in 2013. The Court considered arguments but found the writ petition lacking in merits. The imported capital goods cleared under EPCG License can be confiscated under Section 125 of the Customs Act, 1962, as clarified by the Supreme Court in a previous case. The Court held that the challenge to the Show Cause Notice as time-barred lacks merit, as it involves a mix question of law and facts. The petition was dismissed, granting liberty to the petitioners to reply to the Show Cause Notice within 30 days, with the respondent required to adjudicate and pass orders within 90 days from the date of receipt of the order.

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