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2024 (4) TMI 794 - HC - CustomsAdjudication of SCN after 17 years - Validity of categorizing the petitioner as an importer of barge that drifted due to bad weather - The same was being taken by a tug owned by one MLC Marine Pvt. Ltd. from Singapore to Baharin sometime in the year 2006 - HELD THAT - We are of the prima facie opinion that for more than one reason the impugned show cause notice ought not to proceed; firstly prima facie there appears to be grave doubt as to whether the respondents would have jurisdiction to issue the show cause notice in question by categorizing the petitioner to be an importer. Secondly and more significantly, we find that the show cause notice itself is dated 08 June, 2007. The record indicates that there was no stay on the adjudication of the show cause notice for seventeen years. It may be true that the owner of the tug-MLC Marine Pvt. Ltd. had approached this Court in MLC MARINE PTE LTD. VERSUS COMMISSIONER OF CUSTOMS 2007 (3) TMI 278 - HIGH COURT OF JUDICATURE AT BOMBAY in which the show cause notice issued to the owners of the tug MLC Marine Pvt. Ltd. which was challenged. A coordinate Bench of this Court by an order dated 27 October 2020 in the present proceedings observed that the adjudication of the show cause notice in question was subject to the result of the decision which would be rendered on such writ petition. It, however, appears that the said writ petition was dismissed for want of prosecution some time in December 2022, and it is on such backdrop, the show cause notice as issued to the petitioner, who is the owner of the barge, has now been taken up for adjudication, when admittedly there was no stay on the adjudication of the show cause notice from 08 June, 2007 till date i.e. for a period of 17 years as already noted by us. We thus find that such action on the part of the respondents to adjudicate the show cause notice after 17 years would also be hit by the settled principles of law that a belated adjudication of the show cause notice would render sch adjudication arbitrary and illegal. Thus, we are of the opinion that the petition would require admission. Pending the hearing and final disposal of this petition, the impugned show cause notice shall remain stayed.
Issues involved:
Adjudication of show cause notice after 17 years, jurisdiction of respondents to issue show cause notice, legality of show cause notice categorizing petitioner as an importer. The judgment by the High Court of Bombay pertains to the adjudication of an impugned show cause notice dated 08 June, 2007. The petitioner, represented by Mr. Engineer, challenged the show cause notice, arguing that it was without jurisdiction, arbitrary, and illegal. The petitioner, categorized as an importer, was called for a personal hearing regarding the notice. The court noted that the barge in question had drifted from the high seas to Indian shores due to bad weather, and questioned the basis for categorizing the petitioner as an importer liable to pay duty. The court expressed prima facie opinion that the show cause notice should not proceed due to doubts on jurisdiction and the long delay of 17 years without adjudication or stay. The court found that the respondents may lack jurisdiction to issue the show cause notice and highlighted the significant delay in adjudication, noting that there was no stay on the notice for 17 years. The court referenced a previous writ petition related to the owners of the tug involved in the incident, observing that the show cause notice to the petitioner was taken up for adjudication after the dismissal of the writ petition in December 2022. Such belated adjudication was deemed arbitrary and illegal, citing the case of Coventry Estates Pvt. Ltd. vs. The Joint Commissioner, CGST and Central Excise and Anr. 2023 (8) TMI 352. As a result, the court opined that the petition required admission and ordered a stay on the impugned show cause notice pending further proceedings.
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