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TMI Blog2024 (6) TMI 139X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. Brief facts of the case are that the importer appellant had imported five consignments of 'Nylon Tafeta' through Mumbai Sea Port by filing five Bills of Entry viz., 7298 dated 18.10.1997; 13241 dated 30.09.1997; 11006 dated 26.05.1997; 12232 dated 27.06.1997; and 3087 dated 09.06.1997 during different period. As the import of such goods required Special Import Licenses, the importer appellant procured the same from the open market through the licensed brokers and handed over these to their Customs Broker (CB) for the purpose of clearance of goods from customs. Subsequent investigation conducted by DRI found that the Special Import Licenses procured by the importer appellant were forged and are in the nature of bogus licenses. Accordingly, the Department initiated show cause proceedings by issue of Show Cause Notice dated 31.03.1999 proposing for confiscation of the imported goods and imposition of penalty on the appellants under the Customs Act, 1962. In adjudication of the above SCN, the learned Commissioner of Customs by issue of the impugned order confiscated the imported goods under Sections 111 (d) and 111 (o) of the Customs Act, 1962, and offering the same to be redeemed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hon'ble High Court in the following cases: (i) Parekh Shipping Corporation Vs. Assistant Collector of Customs, Bombay - 1995 (80) E.L.T. 781 (Bom.) (ii) Neeldhara Weaving Factory Vs. DGFT, New Delhi - 2007 (210) E.L.T. 658 (P&H) 4. Learned Authorised Representative (AR) appearing for the department, on the other hand, submitted that inasmuch as the licenses have been shown as forged and confirmed by the DGFT/license issuing authorities, the impugned order confiscating the imported goods for the violation of Customs law and imposition of penalty on the appellants are sustainable. Therefore, he pleaded that the appeal filed by the appellants is liable to be dismissed. 5. Heard both sides and perused the records of the case. I have examined the submissions advanced by the learned Advocate appearing for the appellants and the learned Authorized Representative of the Department. Further, I have also perused the additional written submissions in the form of paper books submitted by both sides along with citation of case laws which both sides have mentioned in support of their case. 6. The issue involved in these appeals is to decide whether the action taken by the learned Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e license involved in the transaction was provided before the adjudicating authority. Thus the adjudicating authority imposed penalty on the importer appellant on the above basis. The CB appellant was also imposed penalty for the reason that the licenses were given to them on the advice of importer, and there is no evidence to show that whether the license brokers or the CB/CHA was involved in procuring such forged licenses. 8.2 In this regard, I find that the penalty was imposed on the appellants in the impugned order under Section 112(a) of the Customs Act, 1962. Relevant legal provision is extracted and given below: Penalty for improper importation of goods, etc. "Section 112. Any person,- (a) who, in relation to any goods, does or omits to do any act which act or omission would render such goods liable to confiscation under section 111, or abets the doing or omission of such an act, or shall be liable,- (i) in the case of goods in respect of which any prohibition is in force under this Act or any other law for the time being in force, to a penalty not exceeding five times the value of the goods or one thousand rupees (as it stood at the time of dispute and later b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t justify the period of delay in issuing show cause notice to the petitioner for levy of penalty. 10. In Government of India v. Citedal Fine Pharmaceuticals, 1989 (42) E.L.T. 515 (S.C.), it was observed as under :- "6. Learned counsel appearing for the respondents urged that Rule 12 is unreasonable and violative of Article 14 of the Constitution, as it does not provide for any period of limitation for the recovery of duty. He urged that in the absence of any prescribed period for recovery of the duty as contemplated by Rule 12, the officer may act arbitrarily in recovering the amount after lapse of long period of time. We find no substance in the submission. While it is true that Rule 12 does not prescribe any period within which recovery of any duty as contemplated by the Rule is to be made, but that by itself does not render the Rule unreasonable or violative of Article 14 of the Constitution. In the absence of any period of limitation it is settled that every authority is to exercise the power within a reasonable period. What would be reasonable period, would depend upon the facts of each case. Whenever a question regarding the inordinate delay in issuance of notice of dema ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exercise of suomotu power was interpreted to mean within "reasonable time". Relevant observations are as under :- "9. ...Use of the words "at any time" in sub-section (4) of Section 50-B of the Act only indicates that no specific period of limitation is prescribed within which suomotu power could be exercised reckoning or starting from a particular date advisedly and contextually. Exercise of suomotu power depended on facts and circumstances of each case. In cases of fraud, this power could be exercised within a reasonable time from the date of detection or discovery of fraud. While exercising such power, several factors need to be kept in mind such an effect on the rights of the third parties over the immovable property due to passage of considerable time, change of hands by subsequent bona fide transfers, the orders attaining finality under the provisions of other Acts (such as Land Ceiling Act). Hence, it appears without stating from what date the period of limitation starts and with what period the suomotu powers is to be exercised. In sub-section (4) of Section 50-B of the Act, the words "at any time" are used so that the suomotu power could be exercised within reasonable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e studied in their context and construed." The authority has stated again as under :- "In selecting out of different interpretations 'the Court will adopt that which is just, reasonable and sensible rather than that which is none of those things', as it may be presumed that the legislature should have used the word in that interpretation which least offends our sense of justice." 12. The learned single Judge has referred to and relied on various decisions including the decisions of this Court as to how the use of the words 'at any time' in sub section (4) of Section 50-B of the Act should be understood. In the impugned order the Division Bench of the High Court approves and affirms the decision of the learned single Judge. Where a statute provides any suomotu power of revision without prescribing any period of limitation, the power must be exercised within a reasonable time and what is 'reasonable time' has to be determined on the facts of each case." 13. In State of HP and others v. Rajkumar Brijender Singh and others, AIR 2004 SC 3218, referring to Section 20 of the HP Ceiling on Land Holdings Act, 1973, conferring suomotu power on Financial Commissioner, interpreting th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contention of the counsel for the revenue to the effect that the petitioner having committed default cannot be permitted to raise these technical pleas is to be noticed and rejected, being without any merit. 18. In view of the above discussion, the writ petition is allowed, impugned orders Annexures P-13 and P-14 are quashed with no order as to costs." Judgement of Hon'ble High Court of Bombay "2. The respondent No. 1 served show cause notice dated January 19, 1995 on the petitioners claiming that certain goods were reported as short-landed by Bombay Port Trust and the petitioners should account for the same or explained the short-landed goods or otherwise the penalty would be imposed under Section 116 of the Customs Act. The service of show cause notice has given rise to the filing of the petition under Article 226 of the Constitution of India. 2A. Shri Venkateswaran, learned counsel appearing on behalf of the petitioners, submitted that the provisions of Section 116 of the Customs Act should not be exercised after a passage of more than 12 years from the date of vessel leaving Port of Bombay. The learned counsel submitted that it is impossible for the Agents of Foreign ..... X X X X Extracts X X X X X X X X Extracts X X X X
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