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2021 (12) TMI 919 - HC - CustomsValuation of imported goods - redetermination of declared assessable value - demand of differential duty and penalty - immunity from prosecution subject to payment of compounding amount as prescribed under Rule 5 in terms of grant of order under Rule 4(3) of the said Rules - Petitioners having been given several opportunities and the Petitioners choosing not to attend the hearings on the pretext of approaching the Settlement Commission and praying for adjournments clearly shows the malafide on the part of the Petitioners - violation of the principles of natural justice. HELD THAT - It shall be open to the Petitioners to file the appropriate Application under the provisions of Section 137(3) of the Customs Act, 1962 read with the Customs (Compounding of Offences) Rules, 2005 before the jurisdictional Chief Commissioner of Customs, if so advised in accordance with law for compounding of the offences. If such an Application is made, the same shall be dealt with on its own merits and in accordance with law. The intimation dated 29/10/2021 is received by the Petitioners on 16.11.2021 as informed to us across the bar. According to the Petitioners, this intimation is dated 29.10.2021. The intimation gives to the Petitioners time of 30 days from the receipt of the intimation for making the Application under the above provisions. The time of 30 days has also expired on15.12.2021. Thus, it can be seen that the Petitioners have been guilty of gross delay and laches in not abiding by and adhering to the mandate of law. It shall be open to the Petitioners to pursue any other remedy available to the Petitioners including the application to the Settlement Commission in accordance with law. Needless to state that if the Petitioner(s) have voluntarily paid any amount during the period of investigation as stated, the Petitioners shall be entitled to a set off for the said amount. Petition dismissed.
Issues Involved:
1. Challenge to the Order-in-Original redetermining assessable value and levying differential duty and penalty. 2. Alleged violation of principles of natural justice. 3. Petitioners' intent to approach the Settlement Commission. 4. Issuance of communication for compounding of offences. 5. Request for stay on coercive action. Detailed Analysis: 1. Challenge to the Order-in-Original: The Petitioners challenged the Order-in-Original No.129 SA(129) ADG (ADJ)/DRI, MUMBAI/2019-20 dated 24.03.2020, which redetermined the declared assessable value, levied differential duty, and imposed penalties. The order was passed by the Additional Director General (Adjudication), Directorate of Revenue Intelligence, Mumbai. The impugned order was a composite order addressing five entities, with separate reasons provided for each. 2. Alleged Violation of Principles of Natural Justice: The Petitioners argued that the impugned order was passed in gross violation of the principles of natural justice. They contended that despite informing the adjudicating authority of their intent to approach the Settlement Commission, the order was passed without allowing them the opportunity to do so. The Petitioners claimed that the notices issued mentioned the option to settle the cases under Chapter XIVA of the Customs Act, 1962, which was not honored. 3. Petitioners' Intent to Approach the Settlement Commission: The Petitioners repeatedly sought adjournments to approach the Settlement Commission, citing the need to file a consolidated application. Despite being granted several opportunities and adjournments, the Petitioners did not file the application with the Settlement Commission. The court observed that the Petitioners' intent appeared to be to frustrate the adjudication process and delay proceedings. 4. Issuance of Communication for Compounding of Offences: The Dy. Commissioner of Customs issued a communication dated 29/10/2021, informing the Petitioners to apply for compounding of their offences under the Customs (Compounding of Offences) Rules 2005. This communication was challenged by the Petitioners, who sought protection from prosecution. The court noted that the Petitioners had the option to file an application for compounding of offences before the jurisdictional Chief Commissioner of Customs. 5. Request for Stay on Coercive Action: The Petitioners requested the court to stay any coercive action against them, arguing that they were denied the opportunity to approach the Settlement Commission. The court found no merit in this request, noting that the Petitioners had been given ample time and opportunity to approach the Settlement Commission but failed to do so. The court observed that the Petitioners' conduct showed a lack of bona fides and intent to delay the adjudication process. Conclusion: The court dismissed the Petition and the Interim Application, finding no merit in the Petitioners' submissions. The court emphasized that the Petitioners could still file an application for compounding of offences under the relevant provisions of the Customs Act, 1962, and the Customs (Compounding of Offences) Rules, 2005. The court also noted that any amount voluntarily paid by the Petitioners during the investigation could be set off against their liabilities.
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