2017 (4) TMI 1237 - HC - Customs

Provisional order of assessment - Section 28 of the Customs Act, 1962 - seizure of imported Betel Nuts - Held that - Section 28 of the Customs Act, 1962 cannot be invoked until a final order of assessment has been passed. A provisional order of assessment will not suffice fulfillment of the requirement of Section 28 of the Customs Act, 1962 - a proceeding under Section 28 is maintainable in respect of the import from Nhava Sheva Port. The impugned show cause notice take into its wake, import through Durgapur also. So far as Durgapur is concerned the final assessment is yet to be made - interest of justice will be sub-served by allowing the proceeding under that the impugned order of show cause so far as Nhava Sheva is concerned - appeal dismissed - decided against appellant.

Summary

Issues: Show cause notice under Section 28 of the Customs Act, 1962; Provisional release of seized goods; Jurisdiction of issuing authority; Final assessment for imports through different ports.

Analysis:
The petitioner challenged a show cause notice issued by the Customs Authority under Section 28 of the Customs Act, 1962. The petitioner had imported betel nuts from Srilanka under the Indo Srilanka Treaty through two ports - Nhava Sheva and Durgapur. While the consignment from Nhava Sheva had been released, the goods from Durgapur were still seized, awaiting assessment of duty. The petitioner applied for provisional release, which was decided but not accepted. The petitioner argued that a provisional order of assessment does not permit the invocation of Section 28 of the Customs Act, citing legal precedents to support this contention.

The advocate for the department stated that the assessment for imports from Nhava Sheva had been completed and urged the court not to interfere with the show cause notice to that extent. The court considered both parties' arguments and the available evidence. It noted that courts should only interfere with a show cause notice if the issuing authority lacks jurisdiction. Legal precedents were cited to emphasize that Section 28 of the Customs Act, 1962 cannot be invoked until a final assessment order is passed, and a provisional order of assessment is insufficient. In this case, the show cause notice pertained to imports through both Nhava Sheva and Durgapur. The court ruled that the proceeding under Section 28 was maintainable for imports from Nhava Sheva, where the goods had been released upon payment of declared duty, but not for Durgapur, where the final assessment was pending.

The court decided that justice would be served by allowing the proceeding for imports from Nhava Sheva but excluding Durgapur from the scope of the show cause notice. The Customs authorities were directed to proceed with Durgapur imports in accordance with the law. The order clarified that it did not prevent the Customs authority from recovering duties under any account as per the law. The writ petition was disposed of with no order as to costs, and parties could obtain a copy of the order from the website upon compliance with formalities.