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2020 (4) TMI 48 - HC - CustomsRate of Interest on duty as per the order of Settlement Commission - Interest rate reduced from 24% to 15% - EPCG Scheme - Failure to discharge export obligation - benefit of Notification No.28/97- customs dated 01.04.1997 - HELD THAT - The Notification was amended by Notification No.46/2013-cus dated 26.09.2013. The said amendment has kept interest to maximum amount. However, by the time said Notification was issued, the impugned order had been passed - there are no reasons to interfere with the impugned order. That apart the order of a Settlement Commission is final and conclusive in terms of Section 127J of the Customs Act, 1962. In fact as per 127H(2) of the Customs Act, 1962, an immunity granted shall stand withdrawn if such person fails to pay any sum specified in the order of the Settlement Commission within the specified time or fails to comply with any other conditions subject to which the immunity was granted and upon the provisions of this act shall apply as if such immunity had not been granted. Petition dismissed.
Issues involved:
1. Settlement of customs duty and interest under the Export Promotion Capital Goods scheme. 2. Failure to discharge export obligation leading to demand for customs duty and interest. 3. Jurisdiction and discretion of the Settlement Commission. 4. Immunity granted by the Settlement Commission and consequences of non-compliance. Analysis: 1. The petitioner challenged an order by the 1st respondent Settlement Commission regarding the settlement of customs duty and interest amounting to ?5,47,567 under the Export Promotion Capital Goods scheme. The petitioner had imported goods under this scheme and availed benefits of a customs duty notification dated 01.04.1997. 2. Due to the petitioner's failure to discharge the export obligation, a demand cum Show Cause Notice was issued by the 2nd respondent, requiring payment of customs duty foregone along with interest at 24% per annum. The petitioner applied for an extension to fulfill the obligation, which was granted. However, subsequent failures led to further demands and notices. 3. The Settlement Commission, in its impugned order, reduced the interest payable by the petitioner to 15% per annum from the date of import, exercising discretion vested in it. The Commission's decision was based on the provisions of the Customs Act, 1962, and the relevant notifications regarding customs duty and interest rates. 4. The judgment highlighted the finality and conclusiveness of orders by the Settlement Commission under Section 127J of the Customs Act, 1962. It emphasized that failure to comply with the terms specified in the Commission's order could result in the withdrawal of any immunity granted. The judgment dismissed the writ petition, stating no grounds for interference with the Settlement Commission's decision. This detailed analysis covers the issues of customs duty settlement, failure to meet export obligations, the Settlement Commission's jurisdiction, and the consequences of non-compliance with its orders.
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