2018 (3) TMI 1296 - HC - Customs

Effective alternative remedy - Misuse of Tariff Rate Quota Scheme in the import of popcorn maize by M/s.Haji Sattar & Sons, Chennai - Section 129 A(1) of the Customs Act, 1962. Held that - when there is an effective and alternative remedy under Section 129 A(1) of Customs Act, 1962, it would not be appropriate to entertain a writ petition, on the disputed questions of facts - On more than one occasion, the Hon ble Supreme Court, as well as this court, held that, ordinarily, writ petitions should not be entertained when the statutes provide for an effective and alternative remedy, moreso, in revenue matters. There is no material illegality or irregularity in the impugned order - appeal dismissed.

Summary

Issues Involved:
1. Misuse of Tariff Rate Quota Scheme in the import of popcorn maize.
2. Rejection of duty exemption benefit and recovery of customs duty.
3. Confiscation of goods and imposition of penalties.
4. Availability of alternative remedy under Section 129 A(1) of the Customs Act, 1962.
5. Jurisdiction of the writ court in revenue matters.

Issue-wise Detailed Analysis:

1. Misuse of Tariff Rate Quota Scheme in the import of popcorn maize:
The case revolves around the alleged misuse of the Tariff Rate Quota (TRQ) Scheme by M/s. Haji Sattar & Sons in the import of popcorn maize. A show cause notice dated 04.10.2013 was issued by the Directorate of Revenue Intelligence (DRI) to investigate this misuse.

2. Rejection of duty exemption benefit and recovery of customs duty:
The adjudicating authority, in its order dated 17.04.2017, rejected the duty exemption benefit claimed under Sr.No.21 of Notification No.21/2002-Customs dated 01.03.2002 for imports made through Nhava-Sheva Port, Maharashtra, and Seaport-Import, Chennai. The authority ordered the recovery of customs duty at 50% along with applicable Education Cess, confirming a total duty amount of ?2,73,97,613/- for Nhava-Sheva Port and ?1,42,07,363/- for Chennai Seaport under Sections 28(2) and 28(8) of the Customs Act, 1962, along with interest under Sections 28AB/28AA.

3. Confiscation of goods and imposition of penalties:
The adjudicating authority held that the imported popcorn maize was liable to confiscation under Sections 111(d) and 111(o) of the Customs Act, 1962. However, since the goods were not physically available for confiscation, no fine was imposed. Penalties were imposed under Section 114A of the Customs Act, 1962, amounting to ?2,73,97,613/- and ?1,42,07,363/- for Nhava-Sheva and Chennai imports, respectively, jointly and severally on M/s. Haji Sattar & Sons and M/s. State Trading Corporation of India Ltd. Additional penalties were imposed on individuals under Section 112 of the Customs Act, 1962.

4. Availability of alternative remedy under Section 129 A(1) of the Customs Act, 1962:
The writ court observed that the Customs Act, 1962 provides for an appeal under Section 129 A(1) against an order-in-original. The court noted that the appellant had an effective and alternative remedy available and permitted the appellant to file an appeal before the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Madras. The court emphasized that writ petitions should not be entertained when statutory remedies are available, especially in revenue matters.

5. Jurisdiction of the writ court in revenue matters:
The court cited several precedents, including Union of India v. T.R. Verma (AIR 1957 SC 882) and C.A. Ibrahim v. ITO (AIR 1961 SC 609), to highlight that when an alternative and equally efficacious remedy is available, the writ jurisdiction should not be invoked. The court reiterated that the High Court should exercise restraint in entertaining writ petitions when statutory remedies are available, particularly in revenue matters, and should ensure that the petitioner has made out a strong case or that there exist good grounds to invoke the extraordinary jurisdiction.

Conclusion:
The court dismissed the writ appeal, stating that there was no material illegality or irregularity in the impugned order. The court upheld the principle that statutory remedies must be exhausted before resorting to writ jurisdiction, especially in revenue matters. Consequently, the connected Civil Miscellaneous Petition was also closed.