2022 (9) TMI 960 - HC - Customs

Applicability of General Alert Circular no. 2/2019 dated 15.04.2019 - proceedings are at the stage of adjudication of the show cause notice - whether the circular form the basis for a duty demand in the petitioner's case - HELD THAT - The petitioner needs to respond to the show cause notice by raising all permissible contentions as available in law including the contentions as available to the petitioner under the orders passed by the Division Bench of this Court in VEDANTA LIMITED, VERSUS UNION OF INDIA, ASSISTANT COMMISSIONER OF CUSTOMS, COMMISSIONER OF CUSTOMS, DIRECTORATE OF REVENUE INTELLIGENCE NEW DELHI, GOA 2020 (2) TMI 703 - BOMBAY HIGH COURT - the petitioner's case need not be examined, when the proceedings are before the department at the stage of adjudication of the show cause notice. Let a decision on the show cause notice in accordance with law be taken within a period of three months from the date the petitioner submits its reply to the show cause notice. Petition disposed off.

Summary

Issues:
Challenge to show cause notice based on General Alert Circular no. 2/2019 issued by DRI.

Analysis:
The petition challenges a show cause notice issued by the Commissioner of Customs, Customs House, Marmagoa, dated 14.8.2020, concerning 17 bills. The petitioner is yet to file a reply to the notice. The petitioner's concern is that the revenue might rely on General Alert Circular no. 2/2019 issued by DRI, which the petitioner considers illegal for duty demand purposes. The petitioner referred to a previous Writ Petition where a duty demand was set aside due to reliance on the same circular without providing a copy to the petitioner. The Court directed the revenue to furnish a copy of the circular to the petitioner and adjudicate the matter without reference to it. The petitioner argues that the show cause notice could be held illegal if the revenue applies the circular against the Court's previous order.

The Division Bench opined that the petitioner should respond to the show cause notice by raising all permissible contentions, including those available under the previous Court order. The Court declined to examine the petitioner's case further at the adjudication stage and instructed the decision on the show cause notice to be made within three months of the petitioner's reply submission. The Court kept open the challenge regarding the prayer clauses of the petition, which sought to quash the Alert Circular no. 2/2019 and direct the respondents to finalize the assessment promptly based on Fe content on WMT basis for classification purposes.

In conclusion, the Writ Petition was disposed of without costs, allowing the petitioner to respond to the show cause notice and keeping the challenge open regarding the Alert Circular and assessment process.