2019 (2) TMI 510 - HC - Customs

Extended period of limitation - suppression of facts - invocation of section 28(2) proviso of the Customs Act, 1962 - import of saffron - Held that - Although the Tribunal should have, in the impugned order, adverted to the allegations in the show cause notice listing out the suppression of facts / fraud as also the conclusion in the Commissioner s order that the Revenue could have invoked the extended period of limitation, still, the omission on the part of the Tribunal to deal with this aspect is not fatal to the case of the assessee - The Tribunal may have agreed with the Commissioner had it referred to all these materials, but today this is a matter of pure conjecture and surmises. We do not wish to indulge into any guesswork for the substantive conclusion of the Tribunal in the impugned order is non-appealable. Once the Revenue was unable to substantiate its pleas and arguments before this Court on merits, then, the Tribunal was not required to render any finding on the point of limitation strictly. Appeal dismissed - decided against Revenue.

Issues involved:
1. Allegation of suppression of fact/fraud by the Revenue
2. Invocation of extended period of limitation
3. Substantive finding of the Tribunal based on precedent
4. Benefit of Notification No. 98 of 2009
5. Tribunal's failure to address allegations in the show cause notice
6. Tribunal's conclusion being non-appealable

Analysis:

1. The first issue revolves around the allegation of suppression of fact/fraud by the Revenue, leading to the invocation of the extended period of limitation. The Revenue contended that the Tribunal failed to appreciate the seriousness of the allegations made in the show cause notice, which warranted the extended period for duty recovery. The Commissioner's order supported the Revenue's stance, emphasizing the duty foregone and the applicability of relevant provisions. However, the Tribunal's cryptic finding was deemed illegal and erroneous by the Revenue, creating a substantial question of law.

2. The second issue concerns the invocation of the extended period of limitation based on the alleged suppression of fact/fraud. Despite the Revenue's arguments, the Tribunal's substantive finding, supported by the judgment in a similar case, favored the assessee. The Tribunal upheld that the import of saffron under food flavor did not violate any conditions, entitling the assessee to the benefit of a specific notification. This conclusion rendered the question of limitation irrelevant, as the substantive finding was deemed unaffected.

3. The third issue highlights the Tribunal's reliance on a precedent to support its decision. The Tribunal's order was based on a judgment involving a similar case, where the import under specific conditions did not warrant duty payment. This reliance on precedent strengthened the Tribunal's decision in favor of the assessee, dismissing the Revenue's appeal.

4. The fourth issue pertains to the benefit of Notification No. 98 of 2009, which played a crucial role in determining the duty liability of the assessee. The Tribunal's conclusion that the assessee was entitled to this benefit further solidified the decision in favor of the assessee, reinforcing the non-demandability of duty.

5. The fifth issue addresses the Tribunal's failure to address the allegations in the show cause notice adequately. While acknowledging this omission, the Court agreed that it did not affect the substantive conclusion in favor of the assessee. The Tribunal's oversight in not discussing the suppression of facts/fraud allegations did not impact the final decision, as the substantive finding was deemed non-appealable.

6. The final issue emphasizes the non-appealable nature of the Tribunal's substantive conclusion. Despite potential agreement with the Commissioner if all materials were considered, the Court refrained from engaging in conjecture. The Tribunal's decision, based on merit and precedent, was deemed conclusive, leading to the dismissal of the Revenue's appeal without any costs.

In summary, the judgment addressed various issues, including allegations of suppression of fact/fraud, invocation of extended limitation period, reliance on precedent, benefit of specific notifications, Tribunal's oversight in addressing allegations, and the non-appealable nature of the substantive conclusion. The decision ultimately favored the assessee, leading to the dismissal of the Revenue's appeal.

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