AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2024 (11) TMI 268
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....rest; (d) appropriated a sum of Rs. 6,00,000/- paid during the investigation; and (e) imposed penalty of Rs. 10,00,000/- each on Shri Harminder Singh and Shri Pawan Tanwar. 2. Learned counsel for the appellants submitted that in this case, the SCN dated 29.3.2017 was issued after more than ten years- well beyond even the extended period of limitation of five years provided for under section 28. According to the learned counsel, the SCN itself was badly time-barred and hence the impugned order upholding the OIO confirming the proposals in such a time barred SCN cannot be sustained. 3. Learned authorised representative for the Revenue submitted that the SCN in this case was not issued under section 28 (which has a time limit) at all but it was issued under section 124 and there is no time limit to issue SCN under section 124. 4. We have considered these submissions on the preliminary question of limitation because if the SCN is time-barred, it will not be necessary for us to examine the merits of the case at all. 5. We find that learned counsel for the appellants is correct in his assertion that the SCN was issued beyond 10 years. The investigations were initiated in 2007 by the ....
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....ection, the proper officer may issue a supplementary notice under such circumstances and in such manner as may be prescribed." 9. Clearly, any notice under section 124 can be issued only for confiscation of goods or imposition of penalty. The proposals in the SCN were as follows: "23. Now, therefore, M/s Nasib Exports, B-17, 2nd Floor, Mayapuri, Phase-II, New Delhi - 110064 and Shri Pawan Tanwar, s/o Shri Prem Prakash Tanwar, r/o WZ-408A, BasaiDarapur, New Delhi-110015 are hereby called upon to show cause to the Additional Commissioner of Customs, New Customs House, New Delhi within 30 days from the date of receipt of this Show Cause Notice or within such extended period as the adjudicating authority may on sufficient cause being shown, allow as to why:- (a) Export incentives availed on the strength of fraudulently obtained DFRC Licence No.0510180922, 0510180921, 0510179456, 0510203116 and 0510203514 which have already been kept under DEL by DGFT vide Orders dated 14/2/2008, 29/4/2008, 29/4/2008 & 19/1/2009 may not be disallowed and Export incentives already availed against RAs got issued by them against these fraudulently obtained DFRC Licences should not recovered from them;....
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....ection 28 and no notice under that section can be issued beyond five years. The SCN has not been issued under section 28 and, therefore, these proposals cannot be sustained. These proposals clearly fall beyond the scope of a notice under section 124. 12. Recovery of drawback for not receiving the remittances is also clearly beyond the scope of any notice issued under section 124. Paying drawback or recovering wrongly paid drawback or recovering drawback because the remittances for the exported goods were not received, are in the nature of execution proceedings flowing from the assessment of the Shipping Bill. These are not adjudication proceedings and cannot change the assessment of the Shipping Bill or the mutual liabilities between the Revenue and the exporter. 13. Drawback is an incentive provided by the Government to exporters to nullify the effect of the duties incurred in the manufacture of the exported goods. It is usually paid as a percentage of the Free on Board (FOB) value of the exported goods as soon as the export is completed. There is no separate adjudication proceeding for sanction of drawback and the officer sanctioning drawback cannot modify the assessment of the....
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....f Customs repay the amount so paid erroneously or in excess, as the case may be, and where the claimant fails to repay the amount it shall be recovered in the manner laid down in sub-section (1) of section 142 of the Customs Act, 1962 (52 of 1962). 16A. Recovery of amount of Drawback where export proceeds not realised. (1) Where an amount of drawback has been paid to an exporter or a person authorised by him (hereinafter referred to as the claimant) but the sale proceeds in respect of such export goods have not been realised by or on behalf of the exporter in India within the period allowed under the Foreign Exchange Management Act, 1999 (42 of 1999), including any extension of such period, such drawback shall be recovered in the manner specified below. Provided that the time-limit referred to in this sub-rule shall not be applicable to the goods exported from the Domestic Tariff Area to a special economic zone. (2) If the exporter fails to produce evidence in respect of realisation of export proceeds within the period allowed under the Foreign Exchange Management Act, 1999, or any extension of the said period by the Reserve Bank of India, the Assistant Commissioner of Custom....
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....officer of customs; or (c) if the amount cannot be recovered from such person in the manner provided in clause (a) or clause (b)- *******" 18. The nature of the recovery of drawback under Drawback Rules was examined at length by the Punjab & Haryana High Court in Jairath International vs. Union of India [2019 (370) E.L.T. 116 (P & H)]. The question before the High Court in that case was whether in the proceedings to recover drawback under Rule 16, the assessed Shipping Bill could be modified. It was held that the proceedings under Rule 16 were in the nature of execution proceedings and cannot modify or change the assessment. The relevant portion of the judgment is as follows: 16. We on examination of the scheme of the 1962 Act and in view of the judgment of Hon'ble Supreme Court in case of ITC v. CCE (supra) find that Rule 16 of Drawback Rules, 1995 is also in the nature of execution proceedings thus an officer even higher in rank than proper officer, who framed assessment at the time of export, cannot modify a shipping bill qua value and consequent entitlement of duty drawback while issuing notice or passing order under Rule 16 of the Drawback Rules, 1995. The contention of....
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....ect of which any prohibition is in force under this Act or any other law for the time being in force, to a penalty 5 [not exceeding three times the value of the goods as declared by the exporter or the value as determined under this Act], whichever is the greater; (ii) in the case of dutiable goods, other than prohibited goods, subject to the provisions of section 114A, to a penalty not exceeding ten per cent. of the duty sought to be evaded or five thousand rupees, whichever is higher: Provided that where such duty as determined under sub-section (8) of section 28 and the interest payable thereon under section 28AA is paid within thirty days from the date of communication of the order of the proper officer determining such duty, the amount of penalty liable to be paid by such person under this section shall be twenty-five per cent. of the penalty so determined; (iii) in the case of any other goods, to a penalty not exceeding the value of the goods, as declared by the exporter or the value as determined under this Act, whichever is the greater." 21. A plain reading of the above section shows that it provides for imposing penalty on persons for certain acts or omissions which r....