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TMI Blog2021 (3) TMI 742X X X X Extracts X X X X X X X X Extracts X X X X ..... the Customs Officials and several summons issued under Section 108 of the Act. The petitioner appeared in response to a few summons but not all. Twenty two (22) containers of dry dates, for which the shelf life is stated to be two years, were seized on the ground that the place of origin was Pakistan and not Oman as contended by the petitioner. This is the crux of the dispute between the petitioner and the Authorities. The rate of duty for import of dry dates from Pakistan is 200% whereas the rate for import from Oman is only 20%. According to the petitioner, there is no mis-declaration or violation of any of the provisions of the Act and no material on the basis of which the imports have been labelled as 'smuggled', as the respondents contend in counter. 4. The seizure was effected on 06.03.2020 and the provisions of Section 110(1) provide that where any goods are seized under sub-section (1) and no show cause notice in respect thereof is given under clause (a) of section 124 within six months of the seizure of the goods, the goods shall be returned to the person from whose possession they were seized The period of six months expired on 05.09.2020, upon expiry of which, the petit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t an order of extension of time for issuance of show cause notice does not require prior opportunity to be afforded to the assessee concerned. The counter narrates various facts in relation to the transactions of import. It also states, inter alia, that investigation at the 'overseas level' and 'correspondence with the overseas supplier' proves misdeclaration of country of origin on the part of the petitioner. These communications relied on by the revenue in counter (at para 7) are, ostensibly, dated 16.03.2020 and 19.03.2020. These details do not, however, form part of the impugned order and are mentioned for the first time in the counter filed by the respondent. 9. Before me, however, Mr.Sundareshwaran sings a different tune conceding to the position that the principles of natural justice have to be adhered to while extending time for issuance of notice. I have specifically sought a clarification from the learned counsel in regard to this position pointing out that what he argues is at variance with what is stated in the counter but he would confirm that his stand is that the principles of natural justice must be adhered to even in passing an order under Section 110(2) proviso. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... artment on the basis of apprehensions. The scope and veracity of such apprehensions would have to be crystallized by way of a show cause notice, putting the assessee to notice of all materials available with the department in support of its apprehensions and allegations, for which purpose the Legislature has granted a period of six months. An extension of the period as aforesaid is provided for, conditional upon reasons being recorded and such reasons and being intimated to the assessee, prior to the expiry of the original period of six months. To argue that the factum of extension of time may be intimated post-extension, is, in my view, contrary to the express language of the provision as well as its scheme. 13. The provisions of Section 110(2) were substituted by the Finance Act, 2018 (Act No.13 of 2018), with effect from 29.03.2018 and prior to amendment, the provisions read as follows: "PROVIDED that the aforesaid period of six months may, on sufficient cause being shown, be extended by the Principal Commissioner of Customs of Commissioner of Customs for a period not exceeding six months." Post amendment, the provision along with the proviso reads as follows: Section 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ost-amendment it was enough if the officer recorded reasons and conveyed them to the assessee, in time. Relevant observations are at paras 15 to 19 extracted below: 15. The change in the statute, in the opinion of this court, is a significant one. The previous provision required the Commissioner to show sufficient cause, which meant that such cause had to be based on objective considerations. However, the amended provision merely requires the Commissioner to record the reasons in writing and "inform the person from whom such good were seized before the expiry of the period so specified". In this court's considered view, the amended provision deliberately sought to overbear the previous view that a notice before extension was necessary. Now two conditions are to be satisfied: one, the Commissioner has to record his reasons in writing, why the extension is necessary, and two, inform the person from whom such good were seized before the expiry of the period so specified. The latter condition is equally important, in the opinion of this court, because it is a pre-requisite for the exercise of the power of extension. The pre-amended provision was silent on this aspect. 16. Ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gative processes and information gathering can be confidential. 18. In M.M.Hassan (supra) a learned Single Judge of the Kerala High Court considered a similar challenge rejecting the case of the petitioner that opportunity is to be afforded prior to extension being granted. 19. Thus, the proper interpretation of Section 110(2) read with the proviso thereto, would be (i) The Principle Commissioner/Customs of Commissioner is to record reasons in writing as to why the proposed extension by six months is justified/warranted (ii) The reasons as well as intimation of extension should be communicated to the assessee before the expiry of the first six months of the original period as completed under Section 110(2) meaning that the factum of the extension should be known to the assessee before the expiry of the period of six months under Section 110(2). The intimation, as aforesaid, will suffice as proper opportunity to the assessee in regard to the extension. 20. The impugned intimation refers to Ordinance 2020 gazetted on 29.09.2020. Chapters 5 and Section 6 read as follows: CHAPTER V RELAXATION OF TIME LIMIT UNDER CERTAIN INDIRECT TAX LAWS 6. Notwithstanding anything contained ..... X X X X Extracts X X X X X X X X Extracts X X X X
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