2017 (2) TMI 1267 - HC - Customs

Shortlanding of goods - Section 116 of the CA, 1962 - Held that - The allegation of shortlanding made in the show cause notice is on the basis of the notings made on the Green Boat Notes. Such allegation remains unsubstantiated and unsupportable in view of such Green Boat Notes not being signed by a person duly authorized by the Customs authorities - Petition allowed - decided in favor of petitioner.

Summary

Issues:
Challenge to show cause notice for alleged shortlanding of goods under Section 116 of the Customs Act, 1962.

Analysis:

1. Alleged Shortlanding of Goods:
- The petitioner challenged the show cause notice issued by Customs authorities alleging shortlanding of goods. The petitioner's counsel argued that the authorities changed their stand through a corrigendum and referred to discrepancies in the Boat Notes presented as evidence.
- The petitioner highlighted procedural lapses in the unloading of goods, pointing out that no authorized Customs personnel were present during the offloading process. The petitioner also questioned the validity of the Green Boat Notes and the authority of the person representing Respondent No. 6 who signed them.

2. Legal Precedents and Jurisdiction:
- The petitioner's counsel cited legal precedents such as Century Enka Limited and Siemens Ltd. to support the argument that a show cause notice without a proper basis can be quashed by a Writ Court. They emphasized that a notice lacking substance or issued without jurisdiction should not be sustained.
- The counsel for Customs authorities argued that shortlanding was established based on the Green Boat Notes and defended the issuance of the show cause notice. However, the Court scrutinized the evidence and found discrepancies in the signing authority of the Boat Notes.

3. Court's Decision and Rationale:
- The Court considered the lengthy pendency of the writ petition since 2003 and the various orders issued during the proceedings. It noted that driving the petitioner to a quasi-judicial authority for a reply to the show cause notice would lead to unnecessary delays and procedural complexities.
- Emphasizing the requirement for Boat Notes to be signed by authorized Customs officers, the Court found no evidence supporting the allegations of shortlanding. As the Green Boat Notes lacked proper signatures and official authorization, the Court set aside the show cause notice and all actions taken based on it.

4. Final Verdict:
- Consequently, the Court disposed of the writ petition, ruling in favor of the petitioner and setting aside the impugned show cause notice. The decision was based on the lack of substantiated evidence regarding shortlanding and the absence of valid signatures on the Green Boat Notes. No costs were awarded in the case.

This detailed analysis of the judgment showcases the legal arguments presented, the examination of evidence, the application of legal precedents, and the final decision reached by the Court in response to the challenge against the show cause notice for alleged shortlanding of goods under the Customs Act, 1962.