TaxTMI 
TaxTMI 
2003 (3) TMI 662
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....,42,260/-. (1) SCN No. S/10-1/97 SIIB dated 17-1-1997 demanding Customs duty of Rs. 58,59,445/- in respect of imports made against Advance Licence Nos. (a) 0324839 dated 19-7-1994, (b) 0327989 dated 12-10-1994, (c) 0328274 dated 21-10-1994, (d) 0317223 dated 4-10-1993, (e) 0321537 dated 11-3-1994 and (f) 0319886 dated 13-1-1994. (2) SCN No. S/10-2/97 SIIB dated 17-1-1997 demanding Customs duty of Rs. 77,81,815/- in respect of imports made against Advance Licence Nos. (a) 0315288 dated 15-6-1993, (b) 0316391 dated 16-8-1993, (c) 0315628 dated 23-7-1993, (d) 0316478 dated 23-8-1993, (e) 0315281 dated 15-7-1993 and (f) 0326352 dated 2-9-1994. 4. The said 2 SCNs alleged that the applicant had mis-declared the net weight of fabrics as well as composition and blend of the exported fabrics with a view to avail higher duty imports entitlement. 5. The applicant filed an application on 27-7-2000 under Section 127B of the Customs Act, 1962 before this Bench for the settlement of his case involving above two show cause notices. In his application, he disclosed and admitted duty liability of Rs. 57,94,348/-. 6. The he....
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.... in terms of sub-section (1) of Section 127C of the Customs Act, 1962. 11. During the hearing held on 4-12-2001 the applicant submitted that the Revenue had issued two Show Cause Notices on 17-1-1997. The demand in the 1st Show Cause Notice is Rs. 58,59,445/- and the 2ntl Show Cause Notice demands duty of Rs. 77,81,815/-. The 1st Show Cause Notice covers 6 advance licenses which were subsequently cancelled ab initio by the licensing authority. The remaining licenses are covered by the 2nd Show Cause Notice. An appeal was filed before the licensing authorities which was allowed by remanding the case back to the original authority for readjudication and the matter is still pending there. The Revenue alleges that the duty against all the 12 licenses is payable for alleged mis-declaration and fabrication of documents. The applicant admits that manipulation was done. To a query from the Bench, the applicant clarified that only 6 licenses had been cancelled ab initio by the DGFT. Even in these cases he had appealed against the said cancellation and the matter is back with the original authority for de novo adjudication which is still pending. It was explained that some exports ha....
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....8) E.L.T. 163 (S.C.). 4. Case laws in support of the proposition that the aforesaid position does not change even if the licence were cancelled ab initio by the licencing authority. (i) Sneh Sales Corporation v. Collector of Customs, 1993 (63) E.L.T. 128 (T) affirmed by the Supreme Court in 2000 (121) E.L.T. 577." The applicant further referred to the judgments in the case of Sneh Sales Corporation v. Collector of Customs - 1993 (63) E.L.T. 128 (T) and since upheld by the Supreme Court reported in 2000 (121) E.L.T. 577 to clarify that though the licenses were cancelled, it will not render the imports already made in the licence unauthorized. 12. The next hearing was held on 17-4-2002. During the hearing, the ld. Chartered Accountant of the applicant submitted that the export obligation was partly fulfilled in respect of the licenses covered under the two Show Cause Notices. The admitted duly liability of Rs. 57,94,748.49 was arrived at after taking into consideration the correct and actual PFY content in the export consignment i.e. 25% of the total weight of the said fabrics which is much lower than what was revealed in the sample test....
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....f immunity from fine, penalty, interest under the Customs Act, 1962 and also immunity from prosecution under the Customs Act, 1962 and Indian Penal Code as well as other Central Laws which might have been contravened while working under the DEEC Scheme. The Revenue was not present. The Commission was constrained to observe that in this case wherein revenue stake of Rs. 1,36,41,260/- is involved, the Revenue has failed to take effective steps to present their case at the various hearings fixed by the Commission. Barring the 1st hearing for admission wherein Revenue was present on 20-9-2002, during subsequent hearings fixed for 12-9-2001, 4-12-2001, 17-4-002 and 1-8-2002, Revenue has been conspicuously absent. Further, the Revenue vide Commission's letter dated 28-2-2002 was called upon to submit certain information. However, no reply has been received from the Revenue. The Commission observed that it was greatly handicapped in disposal of this application in the absence of case records and the information required to clarify certain issues by the Revenue. 15. The Revenue [Commissioner of Customs (EP), Mumbai], vide letter dated 20-11-2002, submitted that the information call....
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....02-Cus., dated 9-8-2002 :- 1. to submit an explanatory note as to how did he comply with Paras (6), (7) and (8) of Notification No. 204/92;. 2. to submit documentary evidence in respect of the calculations in respect of the admitted duty liability; 3. to submit the copy of representation made to DGFT; and 4. to clarify as to how the applicant considered himself to be 'any other person' as mentioned in sub-section (1) of Section 127B of the Customs Act, 1962 when he is claiming that he is not the actual importer. In respect of the above directions, the ld. Consultant referred to Para 7 of the decision of Gujarat High Court in the case of Suresh Dhansiram Agarwal v. Union of India reported in 2005 (183) E.L.T. 424 (Guj.) = 2002 (53) RLT 25 (Guj.) wherein it was held that "when the original license holders i.e. the four firms and the petitioner herein went in appeal before CEGAT, CEGAT found an arguable case in favour of four firms in so far, as the definition of "importer" was concerned and therefore, CEGAT granted unconditional stay in favour of thos....
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....ses, the Commissioner of Customs (Adjudication), Mumbai had held that the original holder of the Licence who had made prior exports and then got endorsement of transferability and who later transferred the licences to various parties (who imported the materials duty free) is liable to pay duty for the fraud committed at the time of fulfilment of export obligation. Thus applicant should be treated as either a deemed importer as has been upheld by the High Court's order referred to above or any other person, mentioned in proviso (1) of Section 127B of the Customs Act, 1962. If the logic is accepted then locus standi of the applicant in this proceeding is beyond doubt. 23. The Revenue was represented by Shri B.K. Hande, Supdt. of Customs, SIIB(X), New Custom House, Mumbai and Shri D. Venu Gopalan, Preventive Officer of Customs, SIIB(X), New Custom House, Mumbai. 24. The Revenue referred to their letter dated 10th February, 2003 wherein it was submitted that" In this case, an opinion/advise was sought from the department of legal affairs, Law Ministry on the issue whether the Settlement Commission has got jurisdiction under Section 127B(1) of Customs Act, 1962 to dispos....
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....e us to be decided now are the following :- (a) Whether the applicant in this case not being the importer of duty free goods under advance licences can be considered to be either a deemed importer or can be covered by the words "any other person" figuring in Section 127B(1) of the Customs Act, 1962. (b) Whether this case can be decided even though the proceeding is pending before DGFT to revoke the advance licences ab initio. (c) Whether the liability disclosed by the applicant can be said to be full and true disclosure after taking into account the PFY content in the exported fabrics which has been certified by the test reports and which also figures in the two show cause notices. 32. The question (a) has now been answered by the Hon. Gujarat High Court in the case reported in 2005 (183) E.L.T. 424 (Guj.) = 2002 (53) RLT 25 (Guj) referred to above in which it has been categorically stated that the licence holder in whose name the advance licences were initially issued, can be treated as an importer. This was the view also taken by the Commissioner of Customs (Adjudication) in several of his or....