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TMI Blog2024 (4) TMI 49X X X X Extracts X X X X X X X X Extracts X X X X ..... er, the same was not acted upon for a substantial period of time, and what was sought to be done by the respondents was to insert a alert after about five years that is on 23 March 2018, which was certainly not a step to execute the demand notice issued under Section 72(1). Having not executed the demand notice dated 8 August 2013 after almost 10 years, a fresh notice under Section 72(2) of the Customs Act, being the impugned notice, came to be issued on 11 December 2023. From a bare perusal of the notice, it is clearly seen that after issuance of the demand notice dated 8 August 2013, which were four demand notices, in respect of four bills of entries, only in respect of one bill of entry, the impugned notice under Section 72(2) has been issued without any action being taken to recover any duty as subject matter of the earlier demand notices. There is no explanation whatsoever coming forth, in regard to the inaction on the part of the Customs officers in enforcing the earlier notice during the period 2013 to 2023, for any recovery that is under the demand notice dated 8 August 2013 - Once such a position was taken by the petitioner and made clear to the department, it was clearly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was to the following effect:- existing warehousing bond is pending for closure even after expiry for want of payment of duty or furnishing of Bank Guarantee for compliance . 3. The case of the petitioners is that the demand notice dated 8 August 2013 was rendered unenforceable, as also the bond which was furnished by the petitioner to the respondents, for warehousing purposes, itself had expired and accordingly was unenforceable, as per the provisions of Section 59 of the Customs Act. It is contended that for such reason the demand notice dated 8 August 2013 and the impugned Alert could not have been foisted on the petitioner, so as to give effect to the old demand, which even otherwise had become redundant. 4. It is on the above premise, the present petition is filed praying for the following reliefs: a) That this Hon ble Court may issue a Writ of Certiorari or an appropriate direction or order calling for the records of the Petitioners case to go into the legality and propriety thereof and thereafter to quash and set aside the Impugned Demand Notices, Notices under section 72(2) of the Act, Notice dated 24.01.2024 and the said Alert. (Exhibit B,12 hereto) b) That this Hon ble Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods. It is the petitioner s case that after such letter was received by the respondent, subsequent imports from the petitioner were allowed to be cleared. However, in December 2022 when the petitioner again imported same goods although such goods for some period were put on hold, on the petitioner pointing out the relevant facts in relation to the pending demand, the petitioner s request for clearance of the goods was accepted thereby the goods subject matter of five fresh Bills of entries were permitted to be cleared on 18 May 2023. 8. It is on the above backdrop to resolve the issues on the alert so inserted, the petitioner made a representation to the respondents requesting that a NOC be granted for clearance of the live consignments which were sought to be imported. Such representation came to be granted and an NOC was received on 25 July 2023 as also the clearance of the goods was granted till 24 October 2023. 9. It is the petitioners case that on 23 October 2022 and 9 January 2024, when the earlier request for removal of the Alert was pending consideration of the respondents, further request came to be made by the petitioner for a no-objection to be granted in relation to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t pursued and / or according to the petitioner, such notice had lapsed. It is in these circumstances, the petitioner had approached this Court praying for the reliefs as noted by us hereinabove. 12. We had heard the proceedings on 8 February 2024, when the petitioner contended that a fresh live consignment was sought to be imported by the petitioner, and it is in such context, it was the petitioner s case that the impugned order would be pressed against the petitioner and a no-objection would not being issued. However, respondent Nos. 2 and 3 on instructions made a statement before the Court that the department would issue a No-objection certificate to the petitioner for clearance of the live consignment. Such consignment was accordingly cleared. Our order dated 8 February 2024 reads thus: 1. Learned counsel for respondent Nos. 2 and 3, on instructions, makes a statement that the department would issue a No Objection Certificate to the petitioner for clearance of the live consignment subject matter of the petition. We accept the statement. 2. Insofar as the issue of alert and other connected issues in that regard, the parties would be heard on the adjourned date of hearing. 3. Stan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n (2), furnish such security as may be prescribed. (4) Any bond executed under this section by an importer in respect of any goods shall continue to be in force notwithstanding the transfer of the goods to another warehouse. (5) Where the whole of the goods or any part thereof are transferred to another person, the transferee shall execute a bond in the manner specified in sub-section (1) or sub-section (2) and furnish security as specified under sub-section (3).] Section 60. Permission for removal of goods for deposit in warehouse (1) When the provisions of section 59 have been complied with in respect of any goods, the proper officer may make an order permitting removal of the goods from a customs station for the purpose of deposit in a warehouse: [PROVIDED that such order may also be made electronically through the customs automated system on the basis of risk evaluation through appropriate selection criteria.] (2) Where an order is made under sub-section (1), the goods shall be deposited in a warehouse in such manner as may be prescribed.] Section 61. Period for which goods may remain warehoused (1) Any warehoused goods may remain in the warehouse in which they are deposited or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in respect of which the interest shall be chargeable from the date on which the proper officer has made an order under subsection (1) of section 60. Explanation . For the purposes of this section, (i) electronic hardware technology park unit means a unit established under the Electronic Hardware Technology Park Scheme notified by the Government of India; (ii) hundred per cent. export oriented undertaking has the same meaning as in clause (ii) of Explanation 2 to sub-section (1) of section 3 of the Central Excise Act, 1944; and (iii) software technology park unit means a unit established under the Software Technology Park Scheme notified by the Government of India.] Section 72. Goods improperly removed from warehouse, etc. (1) In any of the following cases, that is to say, (a) where any warehoused goods are removed from a warehouse in contravention of section 71; (b) where any warehoused goods have not been removed from a warehouse at the expiration of the period during which such goods are permitted under section 61 to remain in a warehouse; [(c) where any warehoused goods have been taken under section 64 as samples without payment of duty;] (d) where any goods in respect of whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -section (1) of Section 72 and the demand notice dated 11 December 2023 as impugned is also issued under Section 72 (2) of the Customs Act. The other provision as sought to be relied on behalf of the respondents is Section 142 of the Customs Act, which provides for Recovery of sums due to Government . It is a general provision falling under Chapter XVII (Chapter providing for Miscellaneous provisions). 19. Having noted the statutory scheme in regard to the recovery of the amounts in respect of goods warehoused and as relevant in the present context, we may observe that it is not in dispute that there were four bills of entries of the year 2005 and 2010 in respect of which goods were partially cleared and some / balance goods part of the said bills of entry had remained to be cleared and were warehoused. The case of the petitioner is that for certain reasons the goods could not be cleared and removed from the warehouse. In such circumstances, the petitioner has contended that although the demand notice dated 8 March 2013 was issued to the petitioner, the same was not acted upon for a substantial period of time, and what was sought to be done by the respondents was to insert a alert ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gust 2013, which were four demand notices, in respect of four bills of entries, only in respect of one bill of entry, the impugned notice under Section 72(2) has been issued without any action being taken to recover any duty as subject matter of the earlier demand notices. There is no explanation whatsoever coming forth, in regard to the inaction on the part of the Customs officers in enforcing the earlier notice during the period 2013 to 2023, for any recovery that is under the demand notice dated 8 August 2013. We may thus observe that a fresh notice under Section 72(2) could not have been issued, when the earlier notice dated 8 August 2013 itself was not acted upon and/or was given up. This would be for more than one reason. In the present facts the petitioner had categorically informed the concerned officer of the respondents, by its letter dated 12 November 2019 that the petitioner had relinquished its title over the remaining goods and subject matter of the demand notice. Once such a position was taken by the petitioner and made clear to the department, it was clearly open to the respondents to proceed in accordance with law and deal with the goods, although, such course of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on Act, 1963, which reads thus: Description of suit Period of limitation Time from which period begins to run On a single bond, where no such day is specified. Three years. The date of executing the bond. 25. Thus, any action to recover the amounts under a bond even otherwise would be within the period of three years from the date of execution of the bond. The bond in question was a single bond executed on a specified date wherein according to the Customs date was not specified in regard to making any payment under the said bond to the respondent. On such count also, although the provision of Section 59 was available to be appropriately considered and complied at the appropriate time by the Customs officers, after the petitioner furnished such a bond, however as the concerned Customs officials having failed to take action to execute the bond, within its prescribed limitation, by operation of law the bond had became un-executable and no action could have been taken thereunder. Certainly any claim under the bond even otherwise would be a deadwood and not enforceable. 26. The above discussion would lead us to conclude that once the recovery under the demand notices dated 8 August 2013 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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