Stay for HP in Customs Case - Now?
LAST week all the major newspapers in India from Times of India to the Hindu Business Line reported that Hewlett-Packard got a stay from CESTAT against a Customs demand of 386 Million US Dollars.
Honestly they did not get a stay - they were asked to pay Rs. 120 Crores and this was in January 2013. Why did all the newspapers wake up after five months?
It all started with a PTI report on 12th June 2013 which simply stated,
US-based Hewlett-Packard's (HP) India unit has won a stay against Customs Department order asking the computer manufacturer to pay USD 386 million in alleged duty evasion. The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has stayed the Commissioner of Customs Bangalore's order against HP India Sales Private Ltd (HPI), HP said.
All the newspapers added their own paddings to the story and cried hoarsely that HP got a Stay from the Tribunal.
And PTI must have got the story from the quarterly report filed by HP to the UNITED STATES SECURITIES AND EXCHANGE COMMISSION on 6th June 2013. In the Report HP had stated,
India: Directorate of Revenue Intelligence Proceedings. On April 30 and May 10, 2010, the India Directorate of Revenue Intelligence (the "DRI") issued show cause notices to Hewlett-Packard India Sales Private Ltd ("HPI"), a subsidiary of HP, seven current HP employees and one former HP employee alleging that HP underpaid customs duties while importing products and spare parts into India and seeking to recover an aggregate of approximately USD 370 million, plus penalties. Prior to the issuance of the show cause notices, HP deposited approximately USD 16 million with the DRI and agreed to post a provisional bond in exchange for the DRI's agreement to not seize HP products and spare parts and to not interrupt the transaction of business by HP in India.
On April 11, 2012, the Bangalore Commissioner of Customs issued an order on the products show cause notice affirming certain duties and penalties against HPI and the named individuals of approximately USD 386 million, of which HPI had already deposited USD 9 million. On December 11, 2012, HPI voluntarily deposited an additional USD 10 million in connection with the products show cause notice. On April 20, 2012, the Commissioner issued an order on the parts show cause notice affirming certain duties and penalties against HPI and certain of the named individuals of approximately USD 17 million, of which HPI had already deposited USD 7 million. After the order, HPI deposited an additional USD 3 million in connection with the parts show cause notice so as to avoid certain penalties.
HPI filed appeals of the Commissioner's orders before the Customs Tribunal along with applications for waiver of the pre-deposit of remaining demand amounts as a condition for hearing the appeals. The customs department has also filed cross-appeals before the Customs Tribunal. On January 24, 2013, the Customs Tribunal ordered HPI to deposit an additional USD 24 million against the products order, which HP deposited in March 2013. The Customs Tribunal did not order any additional deposit to be made under the parts order.
This is what really happened and TIOL had long ago reported the CESTAT Stay order in 2013-TIOL-383-CESTAT-BANG.
This is how the National Newspapers commanding tremendous respect report important news!