2009 (7) TMI 70 - HC - Customs

Cross Examination of the officer who has taken the samples held that - The records relating to taking of the samples shall be made available to the petitioners for their perusal. If the Officer, who did the analysis, is not available, his successor-in office along with the records concerned shall be made available for the cross-examination of the petitioners further - If the petitioners invoked the appellate remedy, normally, they would have paid the amount levied. Because this Court entertained this Original Petition and granted unconditional stay for the last 7 years, the petitioners were saved from paying any amount. We take note of the maxim that act of Court shall prejudice none . By the Act of this Court, the Revenue also cannot be prejudiced.

Summary

Issues:
Challenge to Ext.P9 order of Commissioner of Customs for payment of differential duty; Violation of principles of natural justice; Entitlement to approach High Court directly; Action taken in violation of principles of natural justice and fundamental rights; Quashing of Ext.P9 order and remittance for fresh determination; Payment of interest on any amount found due post fresh determination.

Detailed Analysis:

Issue 1: Challenge to Ext.P9 Order of Commissioner of Customs
The petitioners challenged the Ext.P9 order of the Commissioner of Customs, which directed them to pay a differential duty amount. The case involved the import of newsprint from South Korea in 1999, where the duty payable was disputed based on the wood fiber content of the imported paper. The petitioners sought to contest the assessment and were denied the opportunity to cross-examine the Customs Officer and Chemist involved in the analysis. The High Court entertained the Original Petition and granted a stay on Ext.P9, ultimately quashing the order and remitting the matter for fresh determination.

Issue 2: Violation of Principles of Natural Justice
The petitioners contended that the Ext.P9 order was passed in violation of principles of natural justice as they were not given the opportunity to cross-examine the relevant officers involved in the assessment process. The High Court, citing various legal precedents, emphasized the importance of providing such an opportunity for a fair assessment process. The denial of the chance to cross-examine was deemed to have caused serious prejudice to the petitioners, leading to the order being vitiated.

Issue 3: Entitlement to Approach High Court Directly
The petitioners argued that they were entitled to approach the High Court directly due to the alleged violation of principles of natural justice. Citing legal precedents, the petitioners asserted their right to seek redress directly when faced with such violations, even if statutory remedies were available. The High Court considered this argument and proceeded to hear the Writ Petition on its merits after a prolonged period of pendency.

Issue 4: Action Taken in Violation of Principles of Natural Justice and Fundamental Rights
The petitioners contended that action taken in violation of principles of natural justice would render it arbitrary and violative of their fundamental rights under Article 14 of the Constitution of India. The High Court acknowledged this argument and emphasized the importance of adhering to principles of natural justice to prevent arbitrariness in administrative actions.

Issue 5: Quashing of Ext.P9 Order and Remittance for Fresh Determination
After considering the submissions and legal arguments, the High Court quashed the Ext.P9 order and remitted the matter to the Commissioner of Customs for fresh determination in accordance with the law. The Court directed that the records related to sampling should be made available to the petitioners for perusal and allowed for the cross-examination of the Chemist who conducted the analysis.

Issue 6: Payment of Interest on Any Amount Found Due Post Fresh Determination
Regarding the payment of interest on any amount found due post fresh determination, the High Court noted that the petitioners had not paid the levied amount due to the stay granted by the Court. The Court emphasized that the Revenue should not be prejudiced by the delay caused by the Court and allowed for the recovery of any amount found due with interest from the date it became payable by the petitioners.

In conclusion, the High Court disposed of the Original Petition by quashing the Ext.P9 order, remitting the matter for fresh determination, and addressing the issue of payment of interest on any amount found due post fresh determination.