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2025 (3) TMI 1325 - AT - CustomsTime limitation for demanding SAD - Suppression of facts or not - main pleading of the appellant is on the ground that there was no suppression on their part and accordingly the SAD amount could not have been demanded after more than 4 years from the date of clearance of the goods after the appellant has clearly indicated in the Bill of Entry that they are claiming the exemption under N/N. 20/2006 - HELD THAT - The Commissioner (Appeals) has dismissed the appeal only on the ground that the appellant has not appeared before him whenever the hearings were granted to him. When the appeal has been filed alongwith the Statement of Facts and Grounds of Appeal taken by the appellant it is incumbent on the Commissioner (Appeals) to go through these details and pass a detailed order on an ex-parte basis even if the appellant does not come for the Hearing. The appellant has demonstrated before us that in the CA-1 filed on 22.04.2016 in the Grounds of Appeal and in the Statement of Facts they have clearly taken stand about the Show cause being barred by limitation. The Commissioner (Appeals) was bound to consider this and give a finding as to why it is not acceptable to him in case the OIA is decided against the appellant. This has not been done - the imports have taken place on 13.04.2011 and 28.04.2011 that is immediately after a few days after this amendment was carried out. While the party can be pardoned for not going through this amendment and still claiming the SAD it was also for the officers of the customs to check the Bills of Entry and immediately point out as to why this SAD exemption was being claimed when this amendment has already taken place with effect from 8.04.2011. This was not done. The mistake of the party can be taken as a normal mistake committed by any importer when an amendment is carried out just a few days before the actual import. On the other hand even after coming to know that this amendment has taken place on 8.04.2011 the Department has not come out with any explanation as to what made them wait for more than four years to issue the Show cause notice on 25.05.2015 by invoking the extended provisions of the Appellant to demand the differential Customs Duty - the Department has made out any case of suppression on the part of the Appellant. The impugned order is set aside - appeal allowed.
ISSUES PRESENTED and CONSIDERED
The core legal issues considered in this judgment include:
ISSUE-WISE DETAILED ANALYSIS Issue 1: Time-barred Show Cause Notice The relevant legal framework involves the Customs Act provisions regarding the issuance of Show Cause Notices and the invocation of extended periods due to suppression of facts. The appellant argued that there was no suppression on their part as they had declared the exemption under Notification No. 20/2006-CUS in their Bills of Entry. The Court noted that the appellant had consistently maintained this position before both the adjudicating authority and the Commissioner (Appeals). The Court found that the Department issued the Show Cause Notice more than four years after the import, which typically exceeds the normal limitation period for such notices unless suppression is proven. The Court observed that the Department did not provide a justification for the delay or evidence of suppression by the appellant. Consequently, the Court concluded that the Show Cause Notice was indeed time-barred. Issue 2: Dismissal by Commissioner (Appeals) The Court addressed the procedural aspect where the Commissioner (Appeals) dismissed the appeal due to the appellant's non-appearance. It was emphasized that the Commissioner (Appeals) should have considered the merits of the case based on the appeal documents, even in the absence of the appellant. The Court found that the Commissioner (Appeals) failed to review the grounds of appeal and the statement of facts, which clearly raised the issue of the Show Cause Notice being time-barred. The Court criticized this procedural oversight, stating that the Commissioner (Appeals) was obligated to provide a reasoned decision addressing the appellant's arguments, regardless of their non-appearance. Issue 3: Eligibility for SAD Exemption The appellant claimed the SAD exemption under Notification No. 20/2006-CUS, which was allegedly unavailable due to an amendment effective from 8.04.2011. The Court noted that the imports occurred shortly after the amendment, and the appellant might not have been aware of the change at the time of claiming the exemption. The Court considered the responsibility of customs officers to verify the applicability of exemptions during the clearance process. The lack of immediate action by the customs authorities to question the exemption claimed by the appellant was highlighted. The Court found that the appellant's mistake was understandable given the timing of the amendment and that the Department's delay in issuing the Show Cause Notice further weakened their position. SIGNIFICANT HOLDINGS The Court set aside the impugned order and allowed the appeal filed by the appellant. The significant holdings include:
The Court concluded that the appellant was eligible for consequential relief as per law, reinforcing the principle that procedural diligence is essential in adjudicating appeals and issuing demands.
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