2024 (12) TMI 1251 - HC - Customs

Violation of principles of natural justice - SCN not recived by the petitioner - Seeking quashing the impugned Order - in respect of certain exports the actual realization of the amount in foreign exchange was belated and duty drawbacks could not have been availed by the Petitioner - HELD THAT - A perusal of Section 153 of the Customs Act would show that one of the modes for service under Section 153 (b) of The Customs Act is through registered post, speed post or courier, however, it can also be sent through email in terms of Section 153(c) of The Customs Act. In addition, from 2021 onwards, notices and hearing notices can also be made available on the common portal as well. In the present case, the notice appears to have been sent under Section 153 (b) of The Customs Act and on the display board of the Customs Department. Section 153 (b) only records notice by post or courier and not via email - In the opinion of this Court, the provision itself makes it clear that notices can be sent by email. Moreover, it is also unclear as to why all the notices which were sent have been returned as the Petitioner has categorically stated that there was no change of address. In the overall scheme of things and the facts which have emerged, this Court is of the opinion that owing to the fact that as per the Petitioner the entire amount of the shipping bills and foreign exchange have been realized, the Petitioner ought to be given an opportunity to reply to the Show Cause Notice and a hearing may be afforded to the Petitioner - The impugned order dated 10th November, 2022 is set aside. Let a fresh show cause notice be served upon the Petitioner on the email address. In addition the said show cause notice shall be served upon the ld. Counsel appearing for the Petitioner within one week. Petition disposed off.

Summary

Issues:
Challenge to impugned Order-in-Original dated 10th November, 2022. Service of Show Cause Notice and hearing notices. Compliance with Customs Act regarding notice service.

Analysis:
The Petitioner, an exporter of readymade garments, challenged an Order-in-Original dated 10th November, 2022, alleging a violation of Customs Act and Duty Drawback Rules. The Petitioner contended that the Show Cause Notice was not received, and no opportunity for a hearing was provided. The Respondent argued that the duty drawback should be realized within the prescribed period, and extensions were not sought by the Petitioner. The Court observed a lack of service of notices to the Petitioner, hindering their right to respond. The Court highlighted the importance of proper notice service under Section 153 of the Customs Act.

The Court noted discrepancies in the service of notices, emphasizing the need for email communication in addition to traditional methods. The impugned Order-in-Original was set aside, and a fresh show cause notice was ordered to be served via email to the Petitioner and their counsel. The Petitioner was granted an opportunity to respond and be heard within a specified timeline. The Court directed future compliance with email service for effective communication with parties to avoid ex-parte proceedings.

In a subsequent corrigendum, the Court clarified the reference to the "common portal" as the "Customs Department's common portal" instead of the Directorate General of Foreign Trade's portal. This correction ensured accurate communication of the directive regarding notice service methods. The Court's emphasis on proper notice service through email and common portals aimed to prevent delays and ensure fair proceedings in customs matters.

The judgment highlighted the significance of notice service in legal proceedings, particularly in customs cases, to uphold the principles of natural justice and fair hearing. The Court's decision to set aside the impugned order and mandate email service for future notices underscored the importance of effective communication methods in legal processes. The corrigendum further clarified the portal reference, ensuring accurate implementation of the Court's directive for proper notice service in customs matters.