COMISSIONER OF CUSTOMS (IMPORTS) BOMBAY v. M-S. HICO ENTERPRISES

Citation: [2008] 10 S.C.R. 1

Court: Supreme Court of India

Bench: ARIJIT PASAYAT, P. SATHASIVAM, MUKUNDAKAM SHARMA

Case summary

COMISSIONER OF CUSTOMS (IMPORTS) BOMBAY v. M-S. HICO ENTERPRISES.pdf

Judgment text

[2008f10 S. C. R. 1 COM~SSIONER OF CUSTOMS (IMPORTS) BOMBAY A . \/. MIS. HICO ENTERPRISES . . (Civil Appeal No. 2418 of 2006) APRIL 29; ·2008 [DR. ARIJIT PASAYAT, P.. SATHASIVAM AND DR. MUKUNDAKAM SHARMA, . JJ] · Customs Act, 1962: _s. 28(1) - Transferable Value Based Advance Licence·- Purchased by assessee - Show cause notice to assessee alleging contravention of conditions of Notification no. 2031 92 - Tribunal holding in favour of assessee .... : HELD: In view of the fact that in the Notification there was no reference to alleged infraction by the original licence holder, judgment of . the Tribunal does not sufferfrom any infirmity - Notification- · no. 203192 - Gus. -dated 19. -5. 1992. · -.. : The respondent:-assessee purchased transferable, · Value· Based Advance Licence from the original iicence holder on 20. 4. 1994. A show cause and demand notice dated"4. 9. 1999 was issued to the assessee_a:Ueging contravention of conditions of Notification no.. 203/92-Cus date·d 19. 5. 1992.

The Commissioner of Customs (Import) confirmed the demand. However, the Customs, Excise .. and se·rvice Tax Appellate Tribunal held that the tran~feree could not be once again compelled to prove ·that export obligation under· the. Notification was fulfilled by the original licence holder; and that the transferee could not be . . called upon to fulfil condition (v)(a)". of the Notification. Aggrieved,_ the Revenue filed the instant appeal. ---~-- . ~DlSml ing the appeal, the Court · ---H_l:J. D: In view of the fact that in the show cause -notice issued c:>n 4. 3. 1999, there was no reference to th~ 1 . H ' • · alleged infraction by the transferor of the licence in question, the judgment of the CESTAT does not suffer from any infirmity to warrant interference. [para 6] [3-G] CIVILAPPELLATE JURISDICTION: Civil Appeal No. 2418 ·of 2006 -- From the final Order No.

M/1152/WZB/2004/C-1dated20/ 9/2005 of the Customs, Excise &Service Tax Appellate Tribunal, West Zonal Bench, Mumbai in Appeal No. C/1345/2002-Mum. WITH C. A. Nos. 2447, 4009 of 2007, 4680 of 2006 and 645 0 and 2529 of 2008. · urch·ased transferable Value Based Advance Licenses (in short"'VAB. AL') including a license dated 19. 1. 1993-94 Issued in the name of M/s. Am"ar Taran Ex- J. - • ports, New Delhi. Same was purchased on 20. 4. 1994. Appellant on the basis of that imported consignment vide Bill of Entry . no. 881 dated 30. 3. 1994. Same was allowed duty free allowance. By show cause notice dated· 04. 03. 1999 appellant was ~~ ~ • COMMSSIONER OF CUSTOMS (IMPORTS) BOMBAY 3 v. M/S. HICO ENTERPRISES [Dr. ARIJIT PASAYAT,J. ] called upon to show cause why an amount of Rs. 16,74,702/- could not be recovered and demanded in terms of proviso to Section 28(1) of the Customs Act, 1962 (in short the 'Act') for alleged contravention of certain conditions of Notification No.

203/92-Cus dated 19. 05. 1992. Noticee denied the allegations. However, Commis- ~ sioner of Customs (Import) confirmed the demand along with in- 8 terest and penalty of Rupees One lakh. Same was held to be jointly payable by the original license holder and licensee. It was held that goods were liable in confiscation under Section 111 of the Act. As the goods w_ere not available penalties of Rs. 3 lakhs and Rs. 1 lakh were levied under Section 112 (a) of the Act. In view of divergence of views, the matter was referred to a larger Bench of the Tribunal. The Tribunal inter alia held as follows: "Hence, the satisfaction arrived at in the above manner is final and binding on the customs department.

The Customs department cannot compel the appellants impqrter, who are the transferee, to once again prove that the export obligation has been fulfilled by the original licence-holder in accordance with the notification aRd with9ut availing input stage credit" "The transferee cannot be called upon to fulfill the condition (v) (a) of the Notification No. 203/92-Cus. It is the original licencee, who has to satisfy the above referred condition, but-not the transferee of the licence. In the result, the reference is answered accordingly". In this appeal challenge is to the aforesaid conclusions. Learned counsel for the respondent pointed out that no role was ascribed to it in the show cause notice. It is seen that in view of the fact that in the show cause notice issued on 4. 3. 1999, there was no reference to the alleged infraction of M/s. Amar Taran Exports, the transferor of the license in question, the judgment of the CESTAT does not suffer from any infirmity to warrant interference.

The appeal is dismissed. R. P. Appeal dismissed.