TMI Blog2019 (10) TMI 1401X X X X Extracts X X X X X X X X Extracts X X X X ..... s specified under clause (a) to (d) may extend period and he is bound to inform the concerned person. We are not impressed with the argument of respondents that neither is there requirement to afford opportunity of personal hearing nor communication of extension order to the party concerned. As per respondent extension order is an administrative order and does not affect rights of the party. On the face of it, the contention of the respondent is unreasonable, fallicious and contrary to settled law. As per the amended Section 28(9) if show cause notice is not adjudicated within one (01) year, it stands vacated, thus right of party is certainly affected and he has every right to know reason of extension of period of adjudication of show cause notice. The vacation/lapsing of time period for adjudication of show cause notice results into immunity to party from duty liability proposed in the show cause notice. We are not oblivious of the fact that if extension order is not communicated, possibility of passing ante dated order cannot be ruled out. In the case in hand, the respondent is vehemently pleading that petitioner is governed by un-amended Section 28(9) of the 1962 Act as we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... separately page marked the paper-book of the aforesaid application. MAIN CASE 1. Through the instant Civil Writ Petition, the petitioner is assailing Show Cause Notice dated 17.05.2007 (Annexure P-1) on the ground of jurisdiction of DRI to issue Show Cause Notice and delayed/no adjudication of impugned Show Cause Notice. 2. The conceded position as emerging from record is that the petitioner-a Private Limited Company is engaged in the manufacture of Zinc Sulphate who during 2003-2006 imported its raw material i.e. Zinc Ash and Zinc Skimming. The Customs Authorities after framing assessment permitted clearance of goods, however, Directorate of Revenue Intelligence (for short DRI ) initiated an investigation against the petitioner which culminated into Show Cause Notice dated 17.5.2007 (P-1) alleging misdeclaration of value of goods. The petitioner at the first instance filed an application dated 5.12.2008 before Settlement Commissioner who vide order dated 21.8.2009 (Annexure P-3) rejected the application and relegated the petitioner to the Adjudicating Authority. The petitioner filed reply dated 27.9.2012 (Annexure P-4) before Adjudicating Authority, who fixed the matte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore this Court. CONSIDERATION 5. The preliminary objection of the respondents regarding maintainability of writ in view of alternative remedy is devoid of merits and deserves to be turned down. We while adjudicating case of Anil Kumar Soni Vs UOI CWP No. 6862 of 2017 decided on 21.08.2019 (available on record as Annexure A-1 with CM No. 12782 of 2019) have dealt in detail with same objection, nevertheless counsel for the respondent inspite of being well aware of said judgment is harping on the question of alternative remedy. The present petition is raising question of reasonable period of limitation as well retroactive amendment and as per judgment of Hon ble Supreme Court in the case of State of Punjab Vs Bhatinda District Co- Op. Milk P. Union Ltd. 2007 (217) ELT 325 writ is maintainable because question of reasonable period of limitation cannot be decided by authorities appointed under relevant statute, thus we find it appropriate to entertain present writ Petitions under article 226 of Constitution of India. 6. As cited by counsel for the petitioner, we have decided CWP No. 10889 of 2015 titled as M/s Harkaran Dass Vedpal Vs.Union of India Ors. reported as 2019- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issued more than five years thereafter was held to be unreasonable. 19. For the reasons mentioned above, we find that the notices in the present cases having been issued more than decade back and the proceedings having not been concluded within reasonable time, the same deserves to be quashed. It is not in dispute that the provisions of Section 11A of the Central Excise Act, 1944 involved in the aforesaid judgment are para materia to the provisions of Section 28 of the 1962 Act. From the perusal of above quoted judgment, it can be easily and safely concluded that show cause notices even as per un-amended provisions of Section 28 of the 1962 Act could not be kept pending beyond a reasonable period and authorities were/are duty bound to pass orders within reasonable period of time. 10. Having heard learned Counsel for the parties at length and scrutinized record of the case, the conceded position as emerging in the present petitions is that the DRI issued Show Cause Notice(s) on 20.02.2009 (Annexure P-6) and 19.03.2009 (Annexure P-9). The Petitioners filed writ petitions before this court assailing the show cause notices inter alia on the ground of jurisdiction of DRI to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n of the amended provisions of Section 28 of the 1962 Act. 14. From the bare perusal of the afore-quoted amended Sub-section (9) and newly inserted (9A) of Section 28 w.e.f. 28.03.2018, it is evident that authorities are bound to pass order within one year from the date of Show Cause Notice in cases of Custom Duty not paid/short levied and said period may be extended for a further period of one year by any officer senior in rank to the proper officer having regard to the circumstances under which proper officer was prevented from passing an order before the expiry/lapse of the initial stipulated one year. Still further in case any circumstance as noticed in Sub-section (9A) exists, the extended period of one year provided in Sub Section 9 shall commence from the date when such reason ceases to exist provided the proper officer informs the person concerned of the reason for such non determination of amount of duty or interest under Sub Section 8. Thus the only outcome of non adjudication by the proper officer within one year without invoking of Sub-section (9A) or within the extended period of one year, if any, by a senior officer in terms of the first proviso to Sub Section ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... last date prescribed for furnishing the last return in respect of such return for both assessment of tax due under Sub Section (1) as well as sub section (3) of Section 11 of the PGST Act. It is also not dispute that the notices in the form ST XIV for the assessment years 1995-96 and 1996-97 were issued on 26.04.2001 and 21.04.2001 respectively. The assessment orders under Section 11(3) assessing demand of tax for a sum of ₹ 18,18,318/- and ₹ 10,51,851/- for the respective assessment years was passed on 27.07.2001. Therefore it is not disputed that even if the three years period of limitation was to be computed w.e.f. 03.03.1998, the assessment orders for both the assessment years were beyond the period of limitation as per the amended provisions of Section 11(3) of the Act. It is also not disputed that the learned Tribunal has on consideration of the provisions of PGST Act and ratio of judgments of cited case law has upheld the contention of the petitioner dealer that the amended period of limitation provided under Sub Section (3) being a piece of procedural law would be applicable to the pending cases like the present case. Learned Tribunal has also held that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -section (9A) has been served upon Petitioners by the proper officer seeking the deferment of the commencement of the initial one year notice period for the reasons stated in sub-section (9A). By Amendment of 2018, the legislature has made it clear that no Show Cause Notice shall be kept pending beyond a period of 1 year by the proper officer unless and until requirement of Sub-section (9A) are complied with or beyond the extended period of another one year by an order passed by any officer senior in rank to the proper officer detailing the circumstances which prevented the proper officer from passing the order within the initial period of one year. In the present writ petitions, the Respondent-DRI issued Show Cause Notice on 20.02.2009 (P-6) 19.03.2009 (P-9) for short levied custom duty and interest due to mis-declaration of description and value of goods relating to the two partnership firms/petitioners and at that point of time the proper officer was required to pass an order within one year i.e. By 2010 where it was possible to do so. However after the Amendment w.e.f. 29.03.2018, the Respondent was bound either to pass an order within one year i.e. by 28.03.2019 in ter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the amount of duty or interest, starting from the issuance of show cause notice, the issuance of the subsequent corrigendum, the appointment of the common adjudicating authority, continuance of the case in the call book category, the pendency of the present civil writ petition before this Court. Per contra counsel for the petitioner contended that neither prior to the alleged/purported extension order dated 26.3.2019 opportunity of hearing was granted nor till date copy of said order has been communicated. Thus, in the absence of communication there is no sanctity of the said purported order in the eyes of law. In support of his contention, he cited judgment of this Hon ble Court in the case of A.B. Sugar Ltd. Vs State of Punjab Manu/PH/1155/2009, Aabhas Spinners Pvt Ltd. Vs UOI 2010 (260) ELT 554 (P H) and judgment of Hon ble Supreme Court in the case of Assistant Collector of Customs Vs Charan Das Malhotra MANU/SC/0605/1971. Mr. Bansal further contended that stand of respondent is self contradictory in as much as alleged order dated 26.3.2019, as per reply to Civil Misc No. 12782 of 2019 filed by respondent, has been passed under amended Section 28(9) of 1962 Act, wherea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion, extension of the period of adjudication for a further period of one year may kindly be accorded. From the perusal of the above noting, it is evident that Commissioner has proposed extension but there is no order on the part of Chief Commissioner leaving aside application of mind and reasoned order. Commissioner of Customs in his affidavit dated 30.9.2019 has used word noting which itself shows that no order of extension was passed and it is just a noting on the file on the part of authorities other than Chief Commissioner. As no order of extension, as otherwise vehemently pleaded by Mr. Bindlish, has been passed, contention on behalf of the respondents that Chief Commissioner has granted extension of one year to adjudicate impugned show cause notice is ill founded. 10. Before parting with judgment, we deem it appropriate to deal with question of extension under Section 28(9) and (9A) of 1962 Act. As cited by counsel for the petitioner, this Court in the case of A.B. Sugar Ltd. Vs State of Punjab Manu/PH/1155/2009 has dealt with similar provision. As per Section 11(10) of Punjab General Sales Tax Act, 1948 Commissioner for the reasons to be recorded in writing may e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een placed on record, which further shows the hesitation on the part of the respondent to be transparent in their conduct. Accordingly, the order extending the period of limitation passed under Section 11(10), cannot stand judicial scrutiny and is thus liable to be set aside. 11. For the sake of comparison and better understanding of applicability of ratio of judgment of A.B. Sugar (Supra), Section 11(10) of PGST Act and Section 28(9) (9A) of Customs Act, 1962 as amended w.e.f. 29.03.2018 are reproduced below in juxtaposition: Section 11 Assessment of tax. Section 28 Recovery of duty (10) The Commissioner may, for reasons to be recorded in writing, extend the period of three years, for passing the order of assessment for such further period as he may deem fit. (9) The proper officer shall determine the amount of duty or interest under sub-section (8),- (a) within six months from the date of notice in respect of cases falling under clause (a) of sub-section (1); (b) within one year from the date of notice, in respect of cases falling under sub-section (4). Provided that where the prope ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s and until it is communicated to the Petitioner as per prescribed mode. The petitioner (therein) filed writ petition before this court seeking release of goods and non-issuance of show cause notice within six months as required under Section 110(2) of 1962 Act was one of grounds. The Commissioner of Customs, Amritsar as per affidavit filed by DRI passed an order extending the period of limitation to issue show cause notice, however in the manner prescribed under Section 153 of 1962 Act, order extending period to issue show cause notice was not served upon the Petitioner though later on it was produced in court. In Para 35 and 36 has been observed as under: 35. The matter does not end here. The respondents having passed the order on 20-7-2009, were required to communicate the same by virtue of mandatory provision of Section 153 of the Act. According to the aforesaid provision any order made or decision taken under the Act, is required to be served either by tendering the order/decision or sending it by registered post to the person to whom it is intended or to his agent. Clause (b) of Section 153 of the Act further states that if the order or decision etc. could not be served ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the instant case the said order dated 3rd of November, 1966, extending the period of six months under the aforesaid proviso was certainly an order which affected the rights of the petitioners. In that view of the matter the said order could not become effective until the said order was communicated to the petitioners. The said order was communicated to the petitioners only on the 16th of December, 1966, i.e., after the expiry of the period of six months from the date of seizure. In the premises, I am of the view that the said order was made on the day when it was communicated to the said petitioners, i.e., on the 16th December, 1966, i.e., after a right to get back the goods seized became vested in the petitioners. In the case of Director of Supplies and Disposals, Calcutta v. Member, Board of Revenue, Government of West Bengal, reported in 11 Sales Tax Cases 589, a Division Bench of this Court consisting of Lahiri, C.J. and Bachawat, J. approved of the aforesaid decision of Nripendra Nath Mazumdar v. M.N. Bardhan, (supra), and observed as follows : * * * * where the order of the Board of Revenue was not pronounced in open court, the date of passing of the order is t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, the Proper Officer for the reasons specified under clause (a) to (d) may extend period and he is bound to inform the concerned person. 13. From the reading of sub-section (9) and (9A) of Section 28 of 1962 Act with judgment of this Court in the case of A.B. Sugar Ltd. Vs State of Punjab, Aabhas Spinners Pvt Ltd. Vs UOI 2010 (260) ELT 554 (P H) and Assistant Collector of Customs Vs Charan Das Malhotra, we can easily cull out that authorities are bound to (i) divulge circumstances under which Proper Officer was prevented from passing order [28(9)] or record reasons [28(9A)] (ii) afford opportunity of hearing prior to passing order of extension and (iii) communicate copy of extension order passed either under sub-section (9) or (9A) of Section 28 of the 1962 Act. We are not impressed with the argument of respondents that neither is there requirement to afford opportunity of personal hearing nor communication of extension order to the party concerned. As per respondent extension order is an administrative order and does not affect rights of the party. On the face of it, the contention of the respondent is unreasonable, fallicious and contrary to settled law. As per the amend ..... X X X X Extracts X X X X X X X X Extracts X X X X
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