TMI Blog2015 (10) TMI 30X X X X Extracts X X X X X X X X Extracts X X X X ..... has been made after lapse of more than seven years – High Court in case of Dadri Inorganics Pvt. Ltd. [2010 (8) TMI 320 - GUJARAT HIGH COURT] held that in absence of any period of limitation, it is required that every authority is required to exercise power within reasonable period – Reasonable period prescribed in Customs Act is one year, where there is no wilful misstatement, collusion, suppression, etc. and five years if any of these elements are present – Both these time-limits are already over and therefore, impugned demands for recovery of erroneously sanctioned drawback is hit by time-bar – Liability to penalty without attracting any time limit is matter which needs deeper and careful consideration – Revenue restrained from going ah ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of ₹ 25 lakhs each has been imposed on M/s. Nisum Exports Finance Ltd., ₹ 50 lakhs on M/s. Mehul Exports and ₹ 25 lakhs on M/s. Nisum Global Ltd. In addition, a penalty of ₹ 50 lakhs has been imposed on Shri Nirmal J. Agarwal, Director of all the above-mentioned firms under the provisions of Section 114 of the Customs Act, 1962. Aggrieved of the same, the appellants are before us. 2. The learned Counsel for the appellants submit that in the present case, a show cause notice for recovery of drawback wrongly granted was issued vide notice, dated 29-8-2005 in respect of the exports undertaken and drawback sanctioned during 1997-98 in the case of M/s. Nisum Exports Finance Ltd., during November, 1998 in respect o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... maximum time-limit for recovery of duty, interest and other liabilities under the Customs Act is five years. In the present case the show cause notice has been issued after a lapse of more than five years and therefore, the demands are unsustainable. 2.1 The learned Counsel also submits that the liability to penalty also would not arise once the demands for recovery of drawback is held unsustainable. Reliance is placed on the decisions of the Hon ble Apex Court in the case of Nagpur Alloy Castings Ltd. v. CCE - 2002 (142) E.L.T. 515 (S.C.) and of the Hon ble Allahabad High Court in the case of Coolade Beverages Ltd. v. CCE, Meerut - 2004 (172) E.L.T. 451 (All.) and of the Hon ble Tribunal in the same case - 1999 (110) E.L.T. 862 (Tribun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppression, etc. and five years if any of these elements are present. Therefore, these time-limits would apply in enforcing the provision where no time-limit has been prescribed statutorily. In the present case both these time-limits are already over and therefore, the impugned demands for recovery of erroneously sanctioned drawback is hit by time-bar. 4.2 As regards the imposition of penalties on the appellants, this is a matter which requires deeper consideration. Unlike the Central Excise Act, under the Customs Act, penalty is attracted where the goods are held liable to confiscation. Liability to confiscation arises for contravention of the provision of Section 111 of the Customs Act in the case of import goods and under Section 113 i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the appellants. Inasmuch as we have stayed the demand for drawback as well as penalties, we restrain the Revenue from going ahead with the attachment of property, etc. during the pendency of the appeals. 5. In view of the factual and legal analysis as above, we grant unconditional waiver from the pre-deposit of the dues adjudged against the appellants and stay recovery thereof during the pendency of the appeals. As regards the question as to whether penal provisions could be invoked without any time limit, the matter has to be considered at the time of final hearing of the appeals. Since an important question of law is involved, the appeals should be heard as early as possible and accordingly, we direct the Registry to list the appeals ..... X X X X Extracts X X X X X X X X Extracts X X X X
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