2009 (6) TMI 576 - HC - Customs

Settlement of case - - The petitioners challenge the Final order passed by Settlement Commission, Mumbai, bearing No.34 of 2002-CUS, dated 12.12.2001, turning down the application of the petitioner on the ground that it was not maintainable in light of Section 127B of the Customs Act, 1962, as the petitioner was not the person who had filed the bill of entry. petitioner contending that show cause notice issued to them by proper officer and eligibility for filing application satisfied. Held that in the light of the decision of Yousuff Kasim Sait, any other person appearing in Section 127B of the Customs Act is interpreted to mean in its literal sense and the proviso to the said Section is interpreted to mean that the bill of entry must be filed in the case not necessarily by the person who approaches the Commission, provided such person is served with a show cause notice charging him with duty. The petition, accordingly, stands allowed. Rule is made absolute

Summary

Issues:
Challenge to the Final order passed by Settlement Commission based on Section 127B of the Customs Act, 1962.

Analysis:
The petitioners contested the Final order passed by the Settlement Commission, Mumbai, which rejected their application citing Section 127B of the Customs Act, 1962, as the petitioner did not file the bill of entry. The petitioner purchased polyester chips from Rajwada Industries, which were imported without paying customs duty. A demand was made on both Rajwada Industries and the petitioner for the duty. The petitioner paid a substantial part of the duty and approached the Settlement Commission, which dismissed their application. The petitioner argued that the show cause notice served on them satisfied the requirements of Section 127B, emphasizing that the bill of entry filing may not be essential in all cases.

The petitioner's advocate referred to Section 127B of the Customs Act, highlighting that any person, not just the importer or exporter, can apply to the Settlement Commission. He cited a case where a similar situation was dealt with by the Settlement Commission in Chennai, emphasizing that the filing of a bill of entry by the applicant may not always be necessary. Another case was mentioned where it was clarified that any person served with a show cause notice charging duty can file an application, even if the bill of entry was not filed by them. The advocate argued that the Commission's decision was incorrect and should be overturned.

The respondent's counsel opposed the petition, stating that the proviso to Section 127B was correctly interpreted by the Commission, and no intervention was required. However, she could not provide any contradictory view from a higher court. The court analyzed a previous case and determined that any person served with a show cause notice charging duty can file an application before the Commission, even if they are not the importer or exporter. The court set aside the impugned order and directed the Commission to reconsider the petitioner's application based on the interpretation provided in the previous case. The petition was allowed, and no costs were imposed.