2005 (10) TMI 86 - HC - Customs

Whether the Commissioner of Customs, Bombay has jurisdiction/authority to demand customs duty from the petitioner in respect of goods which are not at all imported by the petitioner at the Bombay port Held, no - If the Commissioner of Customs (Delhi) is unable to verify the documents, it cannot be presumed by Commissioner of Customs (Mumbai) that the documents furnished by the petitioner are not genuine - Detention order issued for enforcement of the demand raised under the OIO are quashed

Issues Involved:
1. Jurisdiction of the Commissioner of Customs, Bombay to demand customs duty.
2. Validity of the demand for customs duty and penalty.
3. Procedural compliance regarding the change of port of registration.
4. Verification and authenticity of documents submitted by the petitioner.
5. Maintainability of the writ petition.

Detailed Analysis:

Jurisdiction of the Commissioner of Customs, Bombay:
The primary issue was whether the Commissioner of Customs, Bombay had the jurisdiction to demand customs duty for goods not imported through the Bombay port. The court noted that the goods under the advance license dated 16-2-1994 were imported through New Delhi, not Bombay. The Commissioner of Customs, Bombay, only has jurisdiction over imports and exports through the Bombay port. Therefore, the Commissioner could not demand customs duty merely because the license was initially registered at Bombay. The court concluded that the demand was without jurisdiction and thus, invalid.

Validity of the Demand for Customs Duty and Penalty:
The Commissioner of Customs, Bombay issued a show cause notice demanding Rs. 42,88,416/- with 24% interest and a penalty of Rs. 4,00,000/-. The notice lacked specifics such as the date of the bill of entry, description, quantity, and declared value of the goods. The demand was based on an estimated bond amount rather than actual imports. The court found this approach speculative and unsustainable, emphasizing that demands must be based on concrete evidence rather than conjecture.

Procedural Compliance Regarding Change of Port of Registration:
The petitioner had initially registered the license at Bombay but later got it amended to New Delhi. The court held that the licensing authorities at New Delhi had the jurisdiction to amend the port of registration. The customs authorities at Bombay could not question this procedural compliance. The court further noted that the petitioner had provided documentary evidence of the amendment and subsequent imports and exports through New Delhi, which were accepted by the licensing authorities.

Verification and Authenticity of Documents Submitted by the Petitioner:
The petitioner submitted various documents to prove compliance with the advance license conditions, including bills of entry, shipping bills, DEEC book extracts, and certificates from Central Excise authorities. The Commissioner of Customs, Bombay, did not dispute the authenticity of these documents but claimed difficulty in verification due to non-cooperation from customs authorities in New Delhi. The court held that the lack of verification could not invalidate the documents or the petitioner's compliance. The Commissioner's inability to verify did not imply that the documents were false.

Maintainability of the Writ Petition:
The court addressed the preliminary objection regarding the maintainability of the writ petition under Article 226 of the Constitution of India. It was argued that the petitioner should have appealed to the Delhi High Court. However, the court noted that when an appeal is dismissed due to delay, the doctrine of merger does not apply, allowing the petitioner to challenge the original order independently. Thus, the writ petition was maintainable.

Conclusion:
The court quashed and set aside the order-in-original dated 30-10-2000 and the detention order dated 25-9-2003, ruling that the demand for customs duty and penalty by the Commissioner of Customs, Bombay was without jurisdiction and based on conjecture. The court emphasized that procedural compliance by the petitioner was in order and the documents submitted were authentic and verified by the appropriate authorities in New Delhi. The rule was made absolute with costs in favor of the petitioner.

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