9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2025 (5) TMI 1631 - HC - CustomsMaintainability of Writ Petitions - efficacious remedy - Entitlement to licence for a private bonded warehouse - application filed under Section 58 r/w Section 65 of the Customs Act 1962 - online application under the MOOWR Scheme to do the manufacturing in the private lowdown i.e. mining area - challenging the rejection orders and cancellation notices - HELD THAT - A recent decision of the Apex Court in the case of The State of Maharashtra and Others v. Greatship (India) 2022 (9) TMI 896 - SUPREME COURT is required to be referred to. The Apex Court in the case of United Bank of India v. Satyawati Tondon and others 2010 (7) TMI 829 - SUPREME COURT observed and held that in a tax matter when a statutory remedy of appeal is available the High Court ought not to have entertained the writ petition under Article 226 of the Constitution of India against the Assessment Order by passing the statutory remedy of appeal. The Customs Act 1962 is an Act where adequate efficacious remedy is provided. Therefore we do not find any ground to interfere with the impugned order under Article 226 of the Constitution of India. Thus the present petition i.e. W.P. No.14776/2025 fails and is hereby dismissed and consequently W.Ps. No.14792/2025 14777/2025 14789/2025 14790/2025 and 14779/2025 are also hereby dismissed. So far as W.Ps. No.16067/2025 and 16204/2025 are concerned as on today only the notice for cancellation has been issued to the petitioner. The petitioner may submit a reply to the impugned show cause notice and if any adverse order is passed then the petitioner shall have a remedy of appeal. Accordingly W.Ps. No.16067/2025 and 16204/2025 are also hereby dismissed.
1. ISSUES PRESENTED and CONSIDERED
- Whether the petitioner was entitled to a licence for a private bonded warehouse and permission to undertake manufacturing or other operations under Sections 58 and 65 of the Customs Act, 1962, read with the Manufacturing and Other Operations in Warehouse Regulations, 2019 (MOOWR Scheme), for the large open mining areas held by it. - Whether the Assistant Commissioner of Customs was justified in rejecting the petitioner's application for grant of licence on the ground that the large open mining area does not qualify as a private bonded warehouse under the MOOWR Scheme. - Whether the writ petitions challenging the rejection orders and cancellation notices are maintainable before the High Court under Article 226 of the Constitution of India, given the availability of statutory remedies of appeal under the Customs Act, 1962. - The procedural propriety of the impugned orders, including whether due opportunity of hearing was afforded to the petitioner before rejection or cancellation. - The legal effect and scope of the statutory appeal provisions under Sections 128, 129A, and 130E of the Customs Act, 1962, in the context of the petitioner's challenge. 2. ISSUE-WISE DETAILED ANALYSIS Issue 1: Entitlement to Licence under Sections 58 and 65 of the Customs Act and MOOWR Scheme Relevant Legal Framework and Precedents: The Customs Act, 1962, under Sections 58 and 65, empowers the licensing of warehouses and permits manufacturing or other operations therein. The MOOWR Scheme, notified under the Act, regulates the grant of licences for private bonded warehouses and manufacturing operations therein. Regulation 4(1)(ii) and 4(2) specify eligibility and application procedures. Court's Interpretation and Reasoning: The Court noted that the petitioner sought licence for a large open mining area exceeding 40 million square feet, held under mining leases from various coalfields. The Assistant Commissioner concluded that such a large, open mining area did not qualify as a private bonded warehouse under the MOOWR Scheme, which envisages enclosed warehouses suitable for storage and manufacturing operations. Key Evidence and Findings: The petitioner's mining leases and vesting letters from the Ministry of Coal established their authority to mine and sell coal. However, the physical nature of the mining area-large, open, and not enclosed-was critical to the licensing authority's decision. The Assistant Commissioner sought clarifications and afforded opportunity to the petitioner before rejecting the application. Application of Law to Facts: The Court upheld the Assistant Commissioner's interpretation that the MOOWR Scheme's benefits and licensing provisions apply only to private bonded warehouses, which are enclosed and suitable for controlled storage and manufacturing. The open mining area did not meet these criteria, thus disqualifying the petitioner's application. Treatment of Competing Arguments: The petitioner argued that the provisions of Section 65 and the MOOWR Scheme were misunderstood and misapplied by the respondents, asserting entitlement to the licence. The Court found no perversity or illegality in the authority's reasoning, emphasizing the physical and regulatory requirements of a bonded warehouse under the Scheme. Conclusion: The rejection of the petitioner's application for licence under Sections 58 and 65 of the Customs Act and MOOWR Scheme was legally valid and justified. Issue 2: Maintainability of Writ Petitions under Article 226 vis-`a-vis Availability of Statutory Appeals Relevant Legal Framework and Precedents: Sections 128, 129A, and 130E of the Customs Act provide a comprehensive appellate mechanism against orders passed by Customs authorities. The Supreme Court's decision in United Bank of India v. Satyawati Tondon (2010) establishes that where an efficacious statutory remedy exists, writ petitions under Article 226 should not ordinarily be entertained. Court's Interpretation and Reasoning: The Court observed that the impugned order rejecting the licence application is appealable before the Commissioner (Appeals) within sixty days under Section 128, thereafter to the Appellate Tribunal under Section 129A, and finally to the Supreme Court under Section 130E. The Court held that the petitioner must exhaust these statutory remedies before approaching the High Court under Article 226. Key Evidence and Findings: The Court reproduced the relevant statutory provisions to highlight the availability and adequacy of the appeal process. It noted that the petitioner had not availed of these remedies prior to filing the writ petitions. Application of Law to Facts: The Court applied the principle of exhaustion of statutory remedies, concluding that the writ petitions were premature and not maintainable given the existence of an alternate efficacious remedy. Treatment of Competing Arguments: The petitioner contended that the impugned orders were perverse and illegal, warranting direct judicial intervention. The Court rejected this contention, emphasizing the need to respect the statutory appellate hierarchy and the precedent discouraging bypass of such remedies. Conclusion: The writ petitions challenging the rejection orders and cancellation notices were not maintainable and were dismissed accordingly. Issue 3: Procedural Fairness and Opportunity of Hearing Relevant Legal Framework: Principles of natural justice require that before adverse orders are passed, affected parties be given an opportunity to be heard. The Customs Act and MOOWR Scheme procedures mandate such procedural safeguards. Court's Interpretation and Reasoning: The Court found that the Assistant Commissioner had issued queries to the petitioner, received detailed clarifications, and afforded due opportunity of hearing before passing the impugned order. The rejection was therefore in compliance with procedural fairness. Conclusion: No procedural irregularity or violation of natural justice principles was found in the impugned orders. Issue 4: Notices for Cancellation of Licences and Further Remedies Relevant Legal Framework: Cancellation of licences under the Customs Act is subject to show cause notices and opportunity to respond. Appeals against cancellation orders are similarly provided under the Act. Court's Interpretation and Reasoning: The Court noted that in respect of two mines where cancellation notices were issued, only notices had been served and no final adverse orders had been passed. The petitioner was directed to submit replies to the show cause notices, and in case of any adverse order, to avail statutory remedies of appeal. Conclusion: The writ petitions challenging only the issuance of cancellation notices were dismissed as premature, with directions to follow due process and statutory appeal remedies. 3. SIGNIFICANT HOLDINGS "The petitioner filed an application under Section 65 r/w Section 58 of the Customs Act before the competent authority for grant of licence. Authority after due consideration found that the licence to such a large open mining area cannot be granted treating it to be a godown." "Admittedly impugned order is appealable and the petitioner has a remedy of appeal against the order of the Assistant Commissioner under Sections 128, 129 and Section 130-E of the Customs Act." "In a tax matter when a statutory remedy of appeal is available, the High Court ought not to have entertained the writ petition under Article 226 of the Constitution of India against the Assessment Order by passing the statutory remedy of appeal." Core principles established include:
Final determinations:
|
