2024 (9) TMI 1366 - HC - Customs

Levy of duty and penalty - challenge to order dated 23.01.2015 by Director General of Health Services under Customs Act - HELD THAT - As per the memo, the proceedings are pending regarding default and violation of terms and conditions of Notification No.64/1988, the possibility of the Tribunal hearing all the matters involving violation of terms and conditions of Notification No. 64/1988 cannot be ruled out. Even if the Tribunal for its convenience hears the matter by clubbing the similar appeals, it is expected that the Tribunal shall apply and examine each appeal on its facts. Though the apprehension expressed in the memo is not justifiable, however, considering the nature of dispute and requirement of examination of facts of each case on its own, the apprehension cannot be brushed aside. Further if the Tribunal is directed to consider the appeal of the petitioner independently, by extending due opportunity of hearing, no prejudice would be caused to the revenue. The Customs, Excise and Service Tax Appellate Tribunal shall dispose of the appeal i.e., Appeal No. 20295/2020 against the petitioner herein, independently on its own merits - Petition disposed off.

Summary

Issues:
Challenge to order dated 23.01.2015 by Director General of Health Services under Customs Act, imposition of duty and penalty during pendency of writ petition, appeal before Customs, Excise and Service Tax Appellate Tribunal, separate consideration of appeal by the petitioner, and opposition to prayer made in memo dated 02.08.2022.

Analysis:
The petitioner, a company registered under the Companies Act, established a hospital in 1989 and availed the benefit of Notification No.64/1988 under the Customs Act. The exemption was later withdrawn due to abuse by certain importers. During the petition, the Principal Commissioner of Customs imposed duty and penalty on the petitioner for importing medical equipment between 1990 and 1992. The Commissioner also dropped the proposal for confiscation of the equipment. An appeal was filed by the Commissioner before the Customs, Excise and Service Tax Appellate Tribunal against the order imposing duty and penalty.

The Senior Counsel for the petitioner argued that the facts of the petitioner's case were different from others and requested a separate consideration of the appeal without being clubbed with similar cases. The respondent authorities imposed duty and penalty during the pendency of the writ petition, leading to the appeal before the Tribunal. The Senior Counsel filed a memo stating that the Tribunal might hear all matters involving the violation of Notification No.64/1988 together, but requested a separate hearing for the petitioner's appeal to ensure a fair examination of the facts.

The Court considered the submissions and directed that the writ petition be disposed of. The Customs, Excise and Service Tax Appellate Tribunal was instructed to independently decide on the appeal against the petitioner, ensuring a fair consideration of the case on its merits. The Court clarified that it had not expressed any opinion on the merits of the case, emphasizing the need for a separate hearing for the petitioner's appeal without causing prejudice to the revenue.