1986 (4) TMI 55 - HC - Customs

Summary

Issues:
1. Misdeclaration of goods' quality and value in import license.
2. Allegations of prejudiced behavior by Customs authorities.
3. Legality of the show cause notice issued by the Assistant Collector of Customs.

Analysis:

Issue 1: Misdeclaration of goods' quality and value in import license
The petitioners, a partnership concern, imported stainless steel sheets from Holland. The Assistant Collector of Customs alleged that the goods were undervalued at US Dollars 1600 per metric tonne, whereas similar prime quality stainless steel was valued at US Dollars 2200 per metric tonne. The petitioners contended that the Customs authorities were biased in declaring the goods as prime quality without confirmation from the supplier. The petitioners sought a writ to withdraw the show cause notice and release the goods based on the invoice value.

Issue 2: Allegations of prejudiced behavior by Customs authorities
The petitioners claimed that the Customs authorities were prejudiced and inclined to treat the goods as prime quality, despite no explicit declaration from the supplier. The petitioners argued that the show cause notice lacked specificity and failed to inform them adequately about the grounds for potential confiscation. The petitioners contended that the notice did not meet the statutory requirements under Section 124 of the Customs Act, 1962, as it did not provide clear grounds for confiscation or penalty.

Issue 3: Legality of the show cause notice
The show cause notice issued by the Assistant Collector of Customs detailed the alleged misdeclaration of goods' value and quality, citing Sections 111(d) and 111(m) of the Customs Act, 1962. The notice indicated discrepancies in the declared value and the actual value of the imported goods, leading to potential confiscation and penalty. The petitioners argued that the notice was vague and did not specify the nature of the objection they were required to address. However, the Court noted that despite some vagueness, the notice conveyed the essential message to the petitioners, allowing them to understand the Customs authorities' concerns regarding the imported goods.

In conclusion, the Court emphasized the importance of responding to show cause notices promptly and addressing Customs authorities' concerns directly. The judgment highlighted the need for clarity in communication between importers and Customs officials to avoid delays and legal disputes.