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TMI Blog2021 (3) TMI 742X X X X Extracts X X X X X X X X Extracts X X X X ..... roceedings for extension in terms of the proviso to Section 110(2) of the Act require the recording of reasons and the intimation of such extension to the person from whom the goods were seized before the expiry of the period of seizure and hence, no separate show cause notice was necessary to be issued to the assessee. The proper interpretation of Section 110(2) read with the proviso thereto, would be (i) The Principle Commissioner/Customs of Commissioner is to record reasons in writing as to why the proposed extension by six months is justified/warranted (ii) The reasons as well as intimation of extension should be communicated to the assessee before the expiry of the first six months of the original period as completed under Section 110(2) meaning that the factum of the extension should be known to the assessee before the expiry of the period of six months under Section 110(2). The intimation will suffice as proper opportunity to the assessee in regard to the extension. Thus, any act that would have had to be carried out between the period 20.03.2020 to 29.09.2020 could now be carried out on or before 30.09.2020. In the present case the impugned intimation is dated 30.09.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the basis of which the imports have been labelled as smuggled , as the respondents contend in counter. 4. The seizure was effected on 06.03.2020 and the provisions of Section 110(1) provide that where any goods are seized under sub-section (1) and no show cause notice in respect thereof is given under clause (a) of section 124 within six months of the seizure of the goods, the goods shall be returned to the person from whose possession they were seized The period of six months expired on 05.09.2020, upon expiry of which, the petitioner is entitled to the return of the consignment. 5. The proviso to Section 110(2) states that the Principal Commissioner of Customs or Commissioner of Customs may, for reasons to be recorded by him in writing, extend the period of six months to a further period not exceeding six months, and inform the person from whom such goods were seized of such extension, before the expiry of the period so specified. The impugned notice in this case was issued on 30.09.2020 extending the period for issuance of show cause notice for further period of six months invoking the proviso to Section 110 (2) of the Act, received by the petitioner on 07.10.2020. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unter filed by the respondent. 9. Before me, however, Mr.Sundareshwaran sings a different tune conceding to the position that the principles of natural justice have to be adhered to while extending time for issuance of notice. I have specifically sought a clarification from the learned counsel in regard to this position pointing out that what he argues is at variance with what is stated in the counter but he would confirm that his stand is that the principles of natural justice must be adhered to even in passing an order under Section 110(2) proviso. This position is recorded. According to him, the impugned intimation is only an intimation proposing to extend time and calling for objections. However, even assuming so, such intimation is beyond the time stipulated in statute, as I have concluded at paragraph 21 of this order. 10. Since the controversy on merits appeared to revolve around the short issue of determination of country of origin, I had at the time of admission of the matter on 25.01.2021 passed the following order: Mr.V.Sundareshwaran, learned Senior Panel Counsel requests some time to file a counter and also object to the request of interim release under Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ension, is, in my view, contrary to the express language of the provision as well as its scheme. 13. The provisions of Section 110(2) were substituted by the Finance Act, 2018 (Act No.13 of 2018), with effect from 29.03.2018 and prior to amendment, the provisions read as follows: PROVIDED that the aforesaid period of six months may, on sufficient cause being shown, be extended by the Principal Commissioner of Customs of Commissioner of Customs for a period not exceeding six months. Post amendment, the provision along with the proviso reads as follows: Section 110 Seizure of goods, documents and things (1) ........ (2) Where any goods are seized under sub-section (1) and no notice in respect thereof is given under clause (a) of section 124 within six months of the seizure of the goods, the goods shall be returned to the person from whose possession they were seized: [PROVIDED that the Principal Commissioner of Customs or Commissioner of Customs may, for reasons to be recorded in writing, extend such period to a further period not exceeding six months and inform the person from whom such goods were seized before the expiry of the period so s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... specified . In this court's considered view, the amended provision deliberately sought to overbear the previous view that a notice before extension was necessary. Now two conditions are to be satisfied: one, the Commissioner has to record his reasons in writing, why the extension is necessary, and two, inform the person from whom such good were seized before the expiry of the period so specified. The latter condition is equally important, in the opinion of this court, because it is a pre-requisite for the exercise of the power of extension. The pre-amended provision was silent on this aspect. 16. There are other reasons for this court to hold that the amendment brought about a radical change in the law. Parliament had knowledge - or is deemed to have knowledge of the existing state of law, which required notice, before extension. Therefore, the change of terminology is significant; the amendment has resulted in only two conditions, being insisted uponprimarily that the Commissioner should record his reasons, before the expiry of the period of limitation and should inform those reasons to the party concerned. 17. Besides, this court also notices that Parliament, awa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mation of extension should be communicated to the assessee before the expiry of the first six months of the original period as completed under Section 110(2) meaning that the factum of the extension should be known to the assessee before the expiry of the period of six months under Section 110(2). The intimation, as aforesaid, will suffice as proper opportunity to the assessee in regard to the extension. 20. The impugned intimation refers to Ordinance 2020 gazetted on 29.09.2020. Chapters 5 and Section 6 read as follows: CHAPTER V RELAXATION OF TIME LIMIT UNDER CERTAIN INDIRECT TAX LAWS 6. Notwithstanding anything contained in the Central Excise Act, 1944, the Customs Act, 1962 (except sections 30, 30A, 41 , 41A, 46 and 47), the Customs Tariff Act, 1975 or Chapter V of the Finance Act,1994, as it stood prior to its omission vide section 173 of the Central Goods and Service Tax Act, 2017 with effect from the 1 51 day of July,2017, the time limit specified in, or prescribed or notified under, the said Acts which falls during the period from the 0~ day of March, 2020 to the 29th day of June, 2020 or such other date after the 29th day of June, 2020 as the Central Gove ..... X X X X Extracts X X X X X X X X Extracts X X X X
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