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2014 (4) TMI 907 - HC - CustomsJurisdiction of Settlement Commission - Customs duty – Mis-declaration - Smuggling and Confiscation of Gold & Coins in India - Scope of Section 127B of the Customs Act, 1962 u/s 124 - Penalty u/s 112 and 114AA of Act – Whether Section 127B bars the jurisdiction of the Settlement Commission for cases of mis-declaration - Held That:- Relying upon Union of India vs. Hoganas India Ltd & Ors [2005 (7) TMI 14 - HIGH COURT OF JUDICATURE (BOMBAY)] – A restrictive interpretation cannot be given to Section 127B - The words "or otherwise" which appear u/s 127B after the words "short levy on account of misclassification" would mean similar acts like misclassification - Principle of ejusdem generis would apply - There was no mandate to limit the jurisdiction of the Settlement Commission in such a manner - Providing an unduly narrow interpretation to Section 127B to nip its jurisdiction at the bud does not cohere with the text or context of the provision - Applications concerning mis-declaration are admissible u/s 127B. Pre-deposit - For approaching the Settlement Commission – Show cause notice - Whether application can be entertained without having to pay duty - Principle of ejusdem generis – Interpretation of Statutes - Clause (c) of the first proviso to Section 127B – Held that:- Clause (c) to the first proviso mandates a pre-condition to approaching the Settlement Commission - The duty "accepted by" the applicant must be paid, before the matter can even be considered by the Settlement Commission - A levy u/s 28-which authorizes a show-cause for duties not levied earlier-includes interest u/s 28AB - Thus, clause (c) requires that the applicant must deposit the duty he accepts to be the liability, along with interest - This means that it is not necessary for the show cause notice to propose a liability amount for it to be 'due' under clause (c) - The Court notices that the self-assessment standard is also prescribed in Section 28(b), as an alternative to the duty ascertained by the Revenue. Relying upon Jagdish Cancer and Research [2001 (8) TMI 113 - SUPREME COURT OF INDIA] - Once served with a show-cause notice u/s 124, the proper officer u/s 28 cannot simultaneously issue a notice – This does not mean that minimum duty is not payable on approaching the Settlement Commission u/s 127B - The customs duty, either the amount required by a Section 28(b), or the amount self-assessed u/s 124 notice, must be paid under clause (c) - The minimum condition of pre-depositing before the Settlement Commission remains intact - Even in cases where there is a notice u/s 124, which does not propose a customs duty, the applicant must self-assess the liability and pay such amount as a pre-condition. Opportunity to approach the Settlement Commission is a sort of concession given by the government to errant assessees to enable them to come clean - This opportunity is hedged in by certain conditions, one of which is that the assessee shall pay the additional amount of customs duty accepted by him along with interest due u/s 28AB - An assessee is permitted to approach the Settlement Commission subject to inviolable conditions, the proper and complete compliance with which cannot be compromised or condoned in any manner - Even on this score the petitioner has to fail - This Court clarifies this judgment leaves open the parties contentions on other grounds, including the applicability of Section 123 by way of the third proviso to Section 127B, which may be considered by the Settlement Commission, if advanced by the parties – Decided against assessee.
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