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2017 (5) TMI 1068 - AT - CustomsConfiscation - redemption fine - penalty - import of jack-up drilling rigs - unauthorised import - clandestine clearance - The impugned order held that the duty liability of ₹ 85,90,07,461 crystallised upon entry of the rigs in designated areas, that these had been wrongly declared as cargo in the manifest, that the customs procedures had not been complied with, that the certificates furnished by the importers were forged, that, in the light of questionability of the certificate, there was no necessity to carry out verification of handwriting, that the failure of witness to appear for cross-examination would not vitiate the proceedings - impugned order challenged on three grounds, jurisdictional incompetence, the applicability of bar of limitation in section 28 of Customs Act, 1962 and the dutiability of rigs at the time of import. Held that: - None other than Commissioner of Customs, Mumbai or any authority vested with all-India jurisdiction is empowered to exercise powers under section 111 or to assess and recover duty in relation the goods that were imported and deployed in the designated areas. Amenability of section 12 of Customs Act, 1962 for recovery of short-paid or unpaid duty - Held that: - There can be no doubt that decisions of courts are precedents that may lay the foundation for demand of duty in adjudication orders but it is, indeed, doubtful if a show cause notice can rely upon judicial decisions as authority for demanding duty. The reasons are not far to seek: the peculiarities, singularities and angularities that characterise a particular dispute which may find judicial settlement that may not necessarily be replicated in another; it is only upon hearing the person served with the notice, and upon taking note of the defence, that a reasonable conclusion can be drawn of similarity with or distinction from another dispute. It is, therefore, inappropriate to cite the authority of an order or decision to raise a demand. There could be no more weighty evidence of pre-judgement, prejudice and bias - The adjudicating authority is, therefore, on a footing that is entirely unsound in seeking to invoke section 12 of Customs Act, 1962; section 28 is the only perceptible provision for recovery of duty that has not been paid or has been short-paid on imported goods - The demand for duty is, therefore, without authority of law and is liable to be set aside. Scope for recovery of duty by recourse to section 125 of Customs Act, 1962 - Held that: - In view of the specific prescription in section 125 that the person redeeming the confiscated goods was also liable to pay the duty, the liability crystallises as a condition of redemption. It needs noting that neither does section 125 of Customs Act specify the authority to determine the duty nor does it vest the obligation in a ‘proper officer’; consequently, section 125 of Customs Act, 1962 does not empower determination or assessment and cannot be resorted except when duty has been already been assessed but foregone at the time of import. Needless to state, the liability to pay the duty is a condition of redemption and is not enforceable when the goods are, themselves, not available for confiscation. It is acknowledged that the imported platform rigs was no longer available at the time of commencement of investigations and was never seized; nor was it available for confiscation. Naturally, redemption on payment of fine was beyond the realm of the possible and no longer is it possible to insist upon liability to pay the duty. The confiscation and demand of duty set aside as having been exercised without authority of law - penalties also fail - appeal allowed - decided in favor of appellant.
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