TaxTMI 
TaxTMI 
2026 (7) TMI 535
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....f the appellants is that DEPB licences/scrips are freely transferable (not disputed by the department) and the appellants were bona fide transferees of those scrips for value having purchased the same for valuable consideration after verifying from the website of the Director General of Foreign Trade (DGFT) that the said licences were genuinely issued by the licensing authority. They had also paid brokerage charge for such purchase and the consideration through blank cheque payment. A show cause notice dated 31.12.2012 was issued by the respondent department contending that those licences were subsequently cancelled vide order dated 09.08.2010 of the licensing authority on the ground that those were obtained by the original licensee upon submission of false documents. It is this issue which is brought for a settlement by the assessee-importers before this Tribunal. 3. During the course of hearing of the appeals, divergent judicial opinions were placed on record and relied upon by both sides. 4. Learned counsel for the appellant, Ms. Shamita Patel, Advocate, argued that it is a settled law that a licence obtained by fraud or misrepresentation is not void ab initio but only voi....
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....ed in 2010 (258) ELT A72 (SC). He also reiterated the reasoning and rationality of the order passed by the Commissioner (Appeals) by placing reliance on the final order passed in Apar Industries Ltd.'s case of 2025, cited supra, that had followed the findings made in several precedent decisions that the importer is not entitled for any benefit on the basis of DEPB scrips obtained by the licensee submitting fraudulent documents. 6. As a rebuttal to such submissions, learned counsel for the appellant, in citing the decision rendered in Sampat Raj Dugar (respondent), cited supra, and Sneha Sales Corporation, cited supra, by Hon'ble Supreme Court, has argued that cancellation of licence subsequent to the import would not operate retrospectively and there is a difference between void licence and voidable licence as has been held in Apar Industries Ltd., cited supra, Commissioner of Customs vs. Patiala Castings P. Ltd., reported in 2012 (283) ELT 269 (Tri.-Del) and Taparia Overseas (P) Ltd. vs. UOI, reported in 2003 (161) ELT 47 (Bom.). To her, as has been held in the referred decisions, when licence is obtained by fraud or misrepresentation, it is only voidable but when licence....
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....xation statute as has been held in Atma Steel Pvt. Ltd. vs. Collector of Central Excise, Chandigarh, reported in RLT (LB-CEGAT)-87 to ensure predictability and certainty of the decisions of this Tribunal that deals with National Statutes, independent analysis of the precedent decision can be done as it can't be zone dependent so as to circumscribe by the view of a particular court in whose jurisdiction, the parties fell. In the instant case, what is noticeable is that concerning realization of duty, penalty etc. from the transferee of the DEPB scrips, divergent decisions have emerged from different benches of this Tribunal, traveled to different High Courts and also confirmed at the Hon'ble Apex Court level. Learned counsel for the appellant submitted that Friends Trading Co. judgment of Hon'ble Punjab & Haryana High Court, on which respondent department has placed its reliance, though had traveled upto Hon'ble Supreme Court at the instance of the assessee-importer, SLP was dismissed without assigning any reason, which is not to be considered as precedent decision as held in Fuljit Kaur vs. State of Punjab, reported in 2010 (262) ELT 40 (SC) at para 8, but in the decision relied up....
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.... ground to interfere in the order upholding the demand of duty on goods, in respect of which exemption has been availed on the basis of DEPB scrips obtained against false documents. 10. After going through the referred decisions of Friends Trading Co., cited supra, that was carried upto Hon'ble Supreme Court by the assessee unsuccessfully, in which all precedent decisions on the issue cited by the appellant, namely in the case of East India Commercial Co. Ltd., Vallabh Design Products, Sampat Raj Dugar, Taparia Overseas Pvt. Ltd. etc., it can very well be said that in Friends Trading Co.'s case, scrips were not forged but were obtained through fraudulent documents and, therefore, the findings of this Tribunal in Borax Morarji Ltd., cited supra, and Apar Industries Ltd.'s decision including its rectification order, on which the appellant is placing heavy reliance, can never be considered to have settled the issue since in both the decisions, may be because of erroneous representation, finding was given by parallel benches of this Tribunal that Friends Trading Co. is one of the cases in which forged DEPB scrips were used and not genuine scrips obtained through fraudulent doc....