Customs Endorsement on Bill of Entry has to be treated as Notice - SC
IT all started in 1993. The appellant imported a ship for breaking up and claimed exemption from 'additional customs duty'. Revenue thought otherwise and an endorsement on the Bill of Entry was made for payment of additional customs duty of Rs. 52,20,000 in addition to the basic customs duty.
The appellant challenged this in the High Court which directed them to submit a bank guarantee for 50% of the disputed amount and a personal bond for the balance 50%.
In the meanwhile the Government came up with an amnesty scheme called ‘Kar Vivad Samadhan Scheme 1998', under which all other liabilities were waived if an applicant pays 50 per cent of the tax arrear. One of the conditions was that a Show Cause Notice/ Demand Notice must have been issued pertaining to the demand.
The appellants filed an application under the Scheme which was promptly rejected by the Customs Authorities on the ground that no Show Cause Notice had been issued!
The Supreme Court yesterday held that an endorsement on the Bill of Entry and return thereof to the importer asking the importer to pay the amount therein would amount to issuing a demand. It would be absurd to hold that though there is a tax arrear, as the appellants were liable to pay the tax/duty demanded, and still the Scheme is inapplicable.
The Supreme Court held that the appellants shall be entitled to the benefit of Kar Vivad Samadhan Scheme.
There is no Scheme that the Government can introduce for the welfare of the people and its own welfare that the babu will not use his brilliance to frustrate. Had the babu accepted the Kar Vivad Declaration, the Government would have got 26 lakh rupees seventeen years ago and the nation would have saved some protracted litigation, but that is not how revenue is collected.
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