2017 (11) TMI 1124 - HC - Customs

Rejection of application made to Settlement Commission - Section 123(1) of the Act - Held that - A reading of Sub-Section (1) of Section 123 of the ACt shows that the place, time and manner of seizure of the goods under the provisions of the Act is immaterial as the section only contemplates that Where any goods to which this section applies are seized . Therefore, no distinction can be made between seizure during the course of examination of cargo or seizure of the goods after they left the customs barrier, etc. This is precisely what the petitioner wants the Court to do which is impermissible under the Statute - the impugned order passed by the Settlement Commission is just and proper and calls for no interference - petition dismissed - decided against petitioner.

Summary

Issues:
Challenge to order of Settlement Commission under Customs Act, 1962 based on third Proviso to Section 127B(1) and Section 127C(1) - Burden of proof in seizure of goods under Section 123 - Jurisdiction of Settlement Commission in case of seized goods.

Analysis:
The petitioner challenged an order by the Settlement Commission under the Customs Act, 1962, which held the application not maintainable due to the third Proviso to Section 127B(1) and rejected it under Section 127C(1). The case involved the seizure of goods under Section 123, where the burden of proving they are not smuggled goods lies with the person from whose possession they were seized. The petitioner imported fabrics under duty exemption but subsequent testing revealed discrepancies, leading to seizure and a show cause notice. Instead of responding to the notice, the petitioner applied to the Settlement Commission, which was rejected.

The petitioner argued that the goods were still in customs barrier, making it suitable for settlement, citing a Special Bench order. However, the revenue contended that recent decisions supported the rejection, emphasizing the jurisdiction of the Settlement Commission in such cases. The Court examined Section 123(1) of the Act, emphasizing that the place and time of seizure are immaterial, and once goods subject to this section are seized, the Settlement Commission lacks jurisdiction. Previous decisions supported this interpretation, leading to the dismissal of the writ petition.

In conclusion, the Court held that the Settlement Commission's rejection was justified based on the statutory provisions and precedents. The petitioner's attempt to differentiate the case based on the goods' location at the time of seizure was deemed impermissible under the law. Citing established legal principles and previous judgments, the Court dismissed the writ petition, affirming the Settlement Commission's decision and denying any interference.