2019 (7) TMI 687 - HC - Customs

Jurisdiction of SCN - Concessional benefit of N/N. 46/11 dated 1st June, 2011 denied - Recall of Customs Duty - Section 28 of the Customs Act, 1962 - effective rates of duty over the goods imported from ASEAN countries - country of origin of goods imported - Case of petitioner is that the impugned notice under the said Act seeks to overwrite the provisions of a treaty entered between the Government of India and Government of Malaysia being the ASEAN India Free Trade Agreement (AIFTA) - scope of certificate issued by a competent Authority. HELD THAT - The issues raised in the petition could be appropriately addressed while responding to the showcause notice. The adjudicating Authority would consider the petitioner's submissions and adjudicate upon the show-cause notice without in any manner being influenced by or controlled by the view taken by the Central Board of Indirect Taxes and Customs while communicating with the Malaysian Authorities. There is no reason at this stage to suspect that the adjudicating Authority would not grant a fair and reasonable hearing to the petitioner and also decide upon the show-cause notice fairly taking into account the petitioner's contentions. The various communications which have been referred to by the CBIC which create an apprehension in the mind of the petitioner that the adjudication proceedings would be an empty formalities as the CBIC has already taken a view against the petition may not be entirely justified. Petition dismissed.

Summary

Issues involved:
1. Challenge to show-cause notice under Article 226 of the Constitution of India regarding customs duty recall.
2. Jurisdictional challenge based on treaty provisions and certificate authenticity.
3. Allegation of fraudulent certificate for concessional duty benefit.
4. Interpretation of treaty provisions and dispute settlement procedure.
5. Consideration of treaty arrangements in municipal law implementation.
6. Dispute resolution between India and ASEAN countries regarding certificate of origin.
7. Adjudication authority's role in deciding issues of misstatements and suppression of facts.
8. Fairness of adjudication process and independence from external influences.

Detailed analysis:
1. The petitioner challenged a show-cause notice seeking to recall customs duty under the Customs Act, 1962. The notice questioned the benefit claimed under Notification No.46/11 dated 1st June, 2011 for importing ingots from Malaysia.
2. The petitioner argued that the notice was without jurisdiction, contending that it sought to override the ASEAN India Free Trade Agreement (AIFTA) provisions and disregarded the certificate issued by a competent authority.
3. The notice alleged fraudulent procurement of a country of origin certificate for Tin Ingots from Malaysia to avail concessional duty benefits under the said Notification.
4. The judgment discussed the agreement between India and ASEAN countries, outlining the certification procedure and dispute settlement mechanism for determining the origin of imported goods.
5. The petitioner claimed that until the dispute under the treaty is resolved, the certificate issued by the appropriate authority in Mumbai remains binding, citing relevant case law and treaty provisions.
6. The petitioner emphasized the need to consider the treaty arrangements in interpreting municipal law and highlighted the ongoing dispute between the two governments regarding the certificate of origin.
7. The respondent argued that the issues raised could be addressed during adjudication, suggesting that the adjudicating authority should decide after granting a personal hearing.
8. The court dismissed the petition, noting that the adjudicating authority should independently consider the petitioner's submissions and decide on the show-cause notice, ensuring a fair hearing and disregarding external influences on the adjudication process.