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Issues:
Interpretation of Kar Vivad Samadhan Scheme - Rejection of declaration due to absence of show cause notice or notice of demand - Payment of basic duty on imported ships - Dispute regarding countervailing duty - Endorsement on Bill of Entry as notice of demand - Applicability of Section 95(ii)(c) - Effect of Bank Guarantee and personal Bond - Substitution of Designated Authority's order - Payment by writ petitioners within four weeks - Extension of benefits under the Kar Vivad Samadhan Scheme. Analysis: The judgment by Ajoy Nath Ray, J., addresses four writ petitions related to the Kar Vivad Samadhan Scheme. The Designated Authority had rejected the declarations in each case citing the absence of show cause notice or notice of demand as required by Section 95(ii)(b) of the Finance (No. 2) Act, 1998. The petitioners had paid the basic duty on imported ships but faced disputes over the countervailing duty. An earlier Division Bench order allowed delivery upon furnishing a Bank Guarantee for 50% of the disputed duty amount. The Court noted that the Bill of Entry's endorsement regarding countervailing duty constituted a notice of demand under Section 95(ii)(b) and fell under the purview of Section 95(ii)(c), rendering further inquiry unnecessary. Moreover, the judgment clarified that the Bank Guarantee and personal Bond did not result in actual payment to the national exchequer, thus excluding the application of the explanation to Section 87(m)(ii)(b). Consequently, the writ petitions were successful in each case, with the Designated Authority's order being substituted by an order accepting the petitioners' declarations. The petitioners were directed to pay the declared amounts within four weeks, failing which the petitions would be dismissed with costs. Upon payment, the benefits of the Kar Vivad Samadhan Scheme would be extended to the petitioners as if the declaration had been accepted on time. Furthermore, the petitioners were permitted to make payments through guaranteeing Banks, leading to the discharge of Bank Guarantees and vacation of the appellate order of stay. The Designated Authority was instructed to issue a certificate of fulfillment under the Kar Vivad Samadhan Scheme within a fortnight of payment. The judgment concluded by directing all parties to act on a signed copy of the order and extended the instructions to guaranteeing Banks, despite not being parties to the writ petitions.
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