https://www.taxtmi.com/css/info/rss_sitemap/rss_feed.css?v=1746094055 https://www.taxtmi.com Business/Tax/Law/GST/India/Taxation/Policies/Legal/Corporate Tax/Personal Tax/Vat Law/Legal Information/Tax Information/Legal Services/Tax Services Tax Management India. Com / MS Knowledge Processing Pvt. Ltd. All rights reserved. One stop solution for Direct Taxes and Indirect Taxes https://www.taxtmi.com/caselaws?id=438583 https://www.taxtmi.com/caselaws?id=438583 Power of Dept to issue supplementary SCN - challenged on the ground that the same is without jurisdiction and the law does not permit issuance of such supplementary Show Cause Notice - independent SCN or supplementary SCN - issuance of SCN prior to insertion of second proviso to Section 124 of the Customs Act, 1962 - HELD THAT:- A reading of Section 124 before the insertion of Second Proviso with effect from 29/3/2018, would clarify that there was no mention of any Supplementary Show Cause Notice that can be issued. In other words, Section 124 was silent as to whether Show Cause Notice once issued, can be followed by another Supplementary Show Cause Notice or not. The amendment carried out by way of Second Proviso clarifies that Supplementary Show Cause Notice can be issued for any Show Cause Notice already issued as per the circumstances and manner that may be prescribed. The circumstances and manner have been prescribed subsequently in June 2019. Therefore, a harmonious reading of Section 124 prior and subsequent to the amendment, would clarify that till the amendment was carried out, there was no specific provision to issue the Supplementary Show Cause Notice. There is nothing to indicate that this Proviso has been brought into effect with a retrospective date. Therefore, a proper and harmonious reading of Section 124, after the addition of the Second Proviso will clarify that only from 29/03/2018, the Department was empowered to issue a Supplementary Show Cause Notice in respect of the Show Cause Notice already issued by them. If the Supplementary Show Cause Notice was issued prior to 29.3.2018 and no amendment was carried out on 29.3.2018 by way of insertion of Second Proviso, the appellant would not have been in a position to challenge the issuing of the Supplementary Show Cause Notice, since the Section 124 was silent, neither allowing nor disallowing the issuing of Supplementary Show Cause Notice. But insertion of the Second Proviso to Section 124 on 29.3.2018, without any clause towards its being retrospective in nature, the clarification has been now brought in only with effect from 29.3.2018 that Supplementary Show Cause Notice can be issued. Therefore, while the appellant could not have challenged the issue of Supplementary Show Cause Notice prior to 29.3.2018, only this amendment carried out to Section 124 would give him the right to do so, which has been taken by him in the present proceedings before the High Court, Adjudicating Authority and this Tribunal. The question also arises as to whether the Supplementary Show Cause Notice issued on 18/5/2017 is to be considered as a Supplementary Notice to the Show Cause Notice or is to be treated as a separate Show Cause Notice. The facts themselves clearly prove that the Department has mentioned very clearly that it is a Supplementary Notice to Show Cause Notice F. No. DRI/KZU/AS/ENO-13/2016/2981 to 2986 dated 26.8.2016. The Addendum issued on 22/9/2017 specifies that it is an Addendum to Supplementary Notice to Show Cause Notice F. No.DRI/KZU/AS/ENO-13/2016/2981 to 2986 dated 26.8.2016 - the very fact that the Adjudicating Authority has held at Para 8.4 of Order in Original that this is not a Supplementary Show Cause Notice but it is an independent Show Cause Notice shows that even he had the doubt that they did not have the power to issue the Supplementary Show Cause Notice as the Second Proviso was inserted only with from 29.3.2018. In order to overcome the action already taken to issue the Supplementary Show Cause Notice, he takes the stand that it is only a Show Cause Notice and not Supplementary Show Cause Notice. Therefore, it cannot be held that the Notice issued to the Appellant is an independent Show Cause Notice. Holding that the issue of Supplementary Notice to the Appellant on 18.5.2017, prior to insertion of Second Proviso to Section 124, which came into effect from 29.3.2018, is legally not sustainable - appeal allowed. Case-Laws Customs Wed, 03 May 2023 00:00:00 +0530