Kar Vivad Samadhan Scheme relief denied where only an advisory letter, not a statutory demand notice, existed.

A non-statutory advisory letter from the Directorate General of Foreign Trade calling on an importer to pay customs duty and surrender a licence did not amount to a demand notice or show cause notice under the Customs Act, 1962. Because the letter did not create an enforceable liability and no amount had become due and payable in the statutory sense, it could not constitute a tax arrear for the Kar Vivad Samadhan Scheme, 1998. The Scheme applied only where tax arrears were already determined as payable or arose from a statutory notice issued on or before 31 March 1998, so the petitioner was not entitled to its benefit.

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Issues: Whether the petitioner was entitled to the benefit of the Kar Vivad Samadhan Scheme, 1998 on the basis of the communication issued by the Directorate General of Foreign Trade, and whether that communication could be treated as a demand notice or show cause notice giving rise to a tax arrear under the Scheme.

Analysis: The Scheme applied only to tax arrears that were determined as due or payable, or that formed the subject matter of a demand notice or show cause notice issued under the relevant enactment on or before 31 March 1998. The communication relied upon was only an advisory letter calling upon the petitioner to pay customs duty and surrender the licence. It was not issued by the Customs authorities under the Customs Act, 1962, was not a statutory demand notice, and did not fasten any enforceable liability. An amount becomes due and payable only when recovery can be enforced under the statute, and that condition was absent here.

Conclusion: The petitioner was not entitled to the benefit of the Scheme, and the communication did not create a tax arrear or statutory demand within the meaning of the Scheme.

Final Conclusion: The petition failed on the sole issue considered, and the Scheme was held inapplicable to the petitioner's claim.

Ratio Decidendi: A mere advisory or non-statutory communication that does not constitute an enforceable demand notice or show cause notice under the relevant enactment cannot be treated as a tax arrear or as an amount due and payable for the purposes of the Kar Vivad Samadhan Scheme, 1998.

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