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Issues Involved:
1. Applicability of the Kar Vivad Samadhan Scheme 1998 to the appellant's case. 2. Interpretation of Section 95(ii)(b) of the Finance (No. 2) Act, 1998. 3. Validity of oral show-cause notice under Section 124 of the Customs Act, 1962. Issue-wise Detailed Analysis: 1. Applicability of the Kar Vivad Samadhan Scheme 1998: The appellant, a private limited company engaged in the manufacture of spectacle frames and sunglasses, imported goods in October 1996 and was under the belief that they were exempt from duty. However, the Customs Authorities confiscated the goods and imposed fines and penalties. The appellant contested these orders through various appeals, which resulted in reduced fines and penalties. During the pendency of these appeals, the appellant sought relief under the Kar Vivad Samadhan Scheme 1998 by filing a declaration. The respondent rejected the declaration on the grounds that the appellant had waived the issuance of a show-cause notice, which was a pre-condition for the scheme's applicability. 2. Interpretation of Section 95(ii)(b) of the Finance (No. 2) Act, 1998: Section 95(ii)(b) stipulates that the scheme does not apply where no show-cause notice or a notice of demand has been issued. The appellant argued that the adjudication order itself should be considered a demand notice and that the absence of a written show-cause notice should not bar the applicability of the scheme. The court examined the definitions of "tax arrear" in Section 87(m) and the provisions of Section 88, which deal with the settlement of tax payable. The court concluded that the appellant's case fell under Section 87(m)(ii)(a), where the amounts due were already determined by adjudication, and thus, the scheme should be applicable. 3. Validity of Oral Show-Cause Notice under Section 124 of the Customs Act, 1962: Section 124 of the Customs Act allows for both written and oral show-cause notices. The court noted that the Additional Commissioner's order was passed after providing a reasonable opportunity of hearing, thus satisfying the requirement of Section 124. The court held that the authorities' assumption that Section 95(ii)(b) contemplates only a written show-cause notice was incorrect. The court emphasized that an oral notice, as provided under Section 124, should be treated as a show-cause notice for the purpose of Section 95(ii)(b) of the scheme. This interpretation aligns with the principles of natural justice and the objectives of the scheme. Conclusion: The court accepted the appeal, set aside the order of the Single Judge and the respondent authority, and directed the respondent to proceed in accordance with the law and the observations made in the judgment. The court clarified that the scheme is applicable to the appellant's case, and an oral show-cause notice is valid under Section 124 of the Customs Act.
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