Jurispruden tiol – Monday's cases

By Vijay Kumar

Central Excise

Rules relating to provisional assessment of duty does not envisage passing of an order in writing before clearance of the goods: Bombay HC

FOR want of a nail, the battle was lost! Here is a case where an assessee ended up paying more than a Crore of rupees as excise duty, more than a decade ago, for the simple sin of executing a B-13 bond for provisional assessment. Had the assessments not been treated as provisional, there would have been no demand at all. The High Court held that there was no requirement of an order for provisional assessment, though the CBEC had categorically stated that an order was very much required and this was binding on Revenue but unfortunately this circular seems to have not been brought to the notice of the Court.

Customs

FTP - 'Denied Entities List' – including the name in the list has civil consequences and cannot be done without notice and hearing : Bombay HC

AS per the guidelines for maintaining the 'Denied Entities List',

"Instances have come to the notice when external agencies such as DRI , CBI , ED etc request for information in connection with some investigations or sometimes recommend licensing authorities to withold further licencing facilities to the firms under investigation. In such cases, if routine information has been called for, the same should be provided. If recommendations to suspend/cancel licenses are also contained in the communication then the information supplied should be adequately examined from the point of view denial of benefits under the Rules/Act. If evidence is found to be insufficient, agencies may be informed that more evidence will be needed before denial of the benefits can be pronounced under the Rules/Acts and will mention the reasons why the licensing authority thinks that there is no sufficient evidence to invoke rules relating to the refusal of license. If external agencies have supplied evidence to the satisfaction of the licensing authority, he shall place the firm in the DEL after issuing a speaking order against the erring firm without disclosing the source of information in the denial order."

In this case before the High Court, the petitioner's name was entered in the 'Denied Entities List' under rule 7 of the Foreign Trade Regulation Rules, 1993. The effect of the name appearing in the 'Denied Entities List' has civil consequences. They were also not given an opportunity of being heard before their name was entered in the 'Denied Entities List.'

Income tax/ Settlement

Settlement Commission – mandatory payment of interest - new provisions challenged - rights of citizens cannot be trampled over by Government, under the banner of speedy justice : Delhi HC

The new provisions of Settlement Commission brought in by last year's budget are under challenge.

The consequence of non-disposal of the pending settlement applications by the Commission is that a large number of them will abate and the applicants will have to face regular assessment on the basis of material that they have disclosed in confidence along with their settlement applications. This will, no doubt, seriously prejudice the applicants but the Respondents do not seem to be concerned about it. The noble intention of Parliament is sought to be defeated by the Respondents by frustrating the implementation of the law, without actually saying so . Is this what speedy justice is all about? It is in this context that we say that the rights of citizens cannot be trampled over by the Respondents, under the banner of speedy justice.

See our columns Monday for the judgements