2024 (3) TMI 812 - HC - Customs

Cancellation of grant of authorised operations of warehousing service activities - Section 16 of the SEZ Act, 2005 - imposition of penalty under Foreign Trade (Development and Regulations) Act, 1992 as made applicable by Rule 54(2) of the Foreign Trade (Regulation) Rules, 1993 for violation of the SEZ Rules - HELD THAT - Respondent Nos. 1 to 3 and 5 could not controvert the submissions of learned advocate for the petitioner by referring to any provision of the SEZ Act. The espondent Nos. 1 to 3 and 5 could not controvert the above submissions of learned advocate for the petitioner by referring to any provision of the SEZ Act. Petition disposed off.

Summary

Issues involved:
The issues involved in this case are the issuance of an impugned letter dated 01.11.2023 suspending D.T.A. Clearance, the legality of the actions taken by the respondents, and the subsequent show-cause notice issued to the petitioner.

Impugned Letter dated 01.11.2023:
The petitioner filed a petition under Article 226 of the Constitution of India seeking various reliefs, including quashing the impugned letter dated 01.11.2023 issued by the office of Respondent No. 2 under the signature of Respondent No. 3. The impugned letter suspended D.T.A. Clearance of M/s. OWS Warehouse, affecting the petitioner's operations related to the import of Areca Nut. The petitioner argued that despite the communication, clearance was permitted until 10th November 2023, causing confusion. The petitioner contended that no intimation was given regarding any ineligibility for exemptions claimed. The Court stayed the impugned communication pending further hearing.

Show-Cause Notice dated 08.01.2024:
Subsequently, a show-cause notice dated 08.01.2024 was issued by Respondent No. 2 to the petitioner, calling for explanations regarding the cancellation of the Letter of Approval for warehousing service activities under Section 16 of the SEZ Act, 2005. The notice also mentioned the possibility of penal action under the Foreign Trade (Development and Regulations) Act, 1992 for violations of SEZ Rules. The petitioner contested the authority of the Specified Officer to pass orders under the SEZ Act based on directions from the Commissioner of Customs. The Court noted that the respondents did not provide any legal basis for the impugned actions.

Judgment:
After considering the arguments, the Court quashed and set aside the impugned order dated 01.11.2023, which suspended the D.T.A. Clearance. The Court directed the respondents to proceed with the adjudication of the show-cause notice dated 08.01.2024 in accordance with the law. The petition was disposed of, and the notice was discharged, indicating a favorable outcome for the petitioner in challenging the impugned actions taken by the respondents.