Provisions for voluntary compliance - CBEC's Customs Manual 2023 - Customs

3. Provisions for voluntary compliance: 3.1 The person chargeable with duty or interest, may pay before service of notice, either on the basis of his own ascertainment of such duty or the duty ascertained by the proper officer, the amount of duty along with the interest payable thereon under Section 28AA or the amount of interest which has not been so paid or part-paid. 3.2 Before issuing notice under section 28(1), the proper officer shall hold pre-notice consultation with the persons chargeable to duty or interest except in cases falling under section 28(4) or 28AAA ; 3.3 The person who has paid the duty along with the interest or amount of interest under section 28(1)(b) shall inform the proper officer of such payment in writing, who on receipt of such information, shall not serve any notice in respect of the duty or interest so paid or any penalty leviable under the provisions of the Act or the rules made thereunder. 3.4 In terms of the provisions of Section 114A , where duty or interest, as the case may be, as determined under section 28(8) and the interest payable thereon under section 28AA is paid within 30 days from the date of communication of the order of the proper officer determining such duty, the amount of penalty liable to be paid by such person shall be twenty percent of the duty or interest, as the case may be, so determined. 3.5 Sub-section (5) of Section 28 of the Customs Act, 1962 provides that the importer or the exporter or the agent or employee of the importer or exporter, to whom a notice is served under the Sub-section (4) of Section 28 of the said Act pays the duty in full or in part as may be accepted by him, and the interest payable thereon under Section 28AA of the said Act and penalty equal to 25% of the duty specified in the notice or the duty so accepted by such person within 30 days of the receipt of the notice. In such case (i) if such person has paid the duty in full together with interest and penalty, the proceedings in respect of such person and other persons to whom notice is served shall, without prejudice to the provisions of Sections 135 , 135A and 140 of the said Act, be deemed to be conclusive as to the matters stated therein. (ii) However, if the duty with interest and penalty that has been paid falls short of the amount actually payable, then, the proper officer shall proceed to issue the notice as provided for in clause (a) of sub-section (1) in respect of such amount which falls short within two years from the date of receipt of information under sub-section (5) of section 28 of the said Act.