2019 (9) TMI 752 - HC - Customs

Imposition of penalty - validity of SCN - SCN challenged on the ground that penalty proposed to be issued under the impugned show cause notice has already been issued on 08.06.2017 by the Assistant Commissioner, Tuticorin - Suppression of material facts - HELD THAT - It was incumbent on the part of the petitioner to have brought to the notice of the Court all the material events that have transpired in the matter, its letters dated 06.06.2017, 08.06.2017 and 14.06.2017 and the sequence of events leading to the issuance of the impugned show-cause notice. The fact that by letter dated 08.06.2017, the petitioner had accepted the levy of penalty and informed the assessing authority that it would remit the same, that it invited issuance of show cause notice, reiterating the request on 14.06.2017 constitute relevant material facts and ought to have been disclosed for appreciation by the Court. This has not been done and it was only when these factors were referred to by the revenue counsel that they came within the knowledge of the Court. Since the petitioner has suppressed material facts leading to the issuance of the show cause notice, it does not deserve the indulgence of the Court - Petition dismissed.

Summary

Issues:
Challenge to show cause notice dated 08.08.2017 based on penalty already imposed on 08.06.2017 by Assistant Commissioner.

Analysis:
The petitioner, a customs broker, filed two bills of entries claiming duty exemption for 'Rice Bran' from Malaysia, which was incorrect as the exemption notification had been replaced. The Assistant Commissioner accepted the petitioner's request for re-assessment on 08.06.2017 and imposed a penalty of ?5,000. The petitioner requested to remit the penalty under protest and sought issuance of a show cause notice, which was not granted. The Department issued the impugned show cause notice on 08.08.2017 while the petitioner's appeal against the penalty was pending before the first appellate authority.

The High Court noted that the affidavit filed by the petitioner lacked material facts regarding the events leading to the show cause notice. The petitioner failed to disclose crucial details such as its acceptance of the penalty, request for re-assessment, and invitation for a show cause notice. The Court emphasized that the petitioner's suppression of material facts deprived it of the Court's indulgence. Consequently, the Court rejected the Writ Petition, granting the petitioner two weeks to file objections to the show cause notice without costs.

In conclusion, the High Court dismissed the Writ Petition due to the petitioner's failure to disclose crucial material facts, thereby rejecting the challenge to the show cause notice dated 08.08.2017. The Court granted the petitioner an opportunity to file objections to the show cause notice within two weeks, emphasizing the importance of full disclosure of material facts in legal proceedings.