Customs demand notices without statutory basis can be quashed where goods are totally destroyed in transit.

Demand notices for customs duty and cess were held to be without statutory authority where the goods had been totally destroyed in transit. Section 39 of the Sea Customs Act applied only to short-levy, mistake, inadvertence, collusion, misconstruction, or erroneous refund, and did not authorise recovery by notice in cases of total loss. The impugned demands therefore lacked legal foundation and were liable to correction by mandamus in writ jurisdiction. The availability of an appeal under Section 188 did not bar relief because that remedy depended on an order under the Act, and alternative remedy is not an absolute bar where the action complained of is without jurisdiction.

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Issues: Whether the notices of demand for customs duty and cess were supported by any statutory provision and could be quashed in writ jurisdiction; and whether the availability of an alternative remedy barred relief under Article 226 of the Constitution of India.

Analysis: The notices were issued by customs authorities demanding payment after the goods had been destroyed in transit, but the relevant enactments did not contain any procedure authorising recovery by such notice in the circumstances of total loss of the goods. Section 39 of the Sea Customs Act was confined to short-levy, error, inadvertence, collusion, misconstruction, or erroneous refund, and did not cover total destruction. Since the demand lacked statutory foundation, it was amenable to correction by mandamus. The asserted appeal under Section 188 of the Sea Customs Act did not bar relief because that remedy was contingent on the existence of an order under the Act, and in any event alternative remedy was not an absolute bar where the impugned action was without jurisdiction.

Conclusion: The notices of demand were illegal and without authority of law, and the petitions succeeded.

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