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TMI Blog2022 (8) TMI 1394X X X X Extracts X X X X X X X X Extracts X X X X ..... rms of Section 28F(3) ibid and Regulation 31 of CAAR Regulations, 2021. 2. Thereafter, the said application for advance ruling was taken up by the Customs Authority for Advance Rulings, New Delhi and upon completion of the procedure laid down by Section 28-I of the Customs Act, 1962 and CAAR Regulations, 2021, Ruling No. CAAR/Del/Spraytec/20/2021, dated 5-10-2021 in respect of the said application No. VIII/CAAR/Delhi/Spraytec/22/2021 [2022 (379) E.L.T. 521 (A.A.R. - Cus. - Del.)] has been pronounced and placed in public domain. 3. The Directorate of Revenue Intelligence, Headquarters New Delhi (DRI, New Delhi in short), vide their letter F. No. DRI/HQ-CI/B-Cell/50D/Enq-22/2018-CI/1513, dated 31-5-2022, inter alia informed CAAR, New Delhi that investigation pertaining to classification of actuator, aerosol valve, pumps etc. imported by M/s. Spraytec India Ltd. is underway in the office of DRI since January, 2019; that M/s. Spraytec India Ltd. had availed the said Rulings by mis-representation of facts, i.e. by hiding the fact of pending investigation before DRI; thus the applicant has misrepresented facts which violated the provisions of Section 28-I(2)(a) of the Customs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ake additional submissions, which was granted by the Authority. 6. The DRI in its submissions has inter alia stated that the contention of the applicant that the question of classification was not pending before any officer of Customs on the day of filing of application by them before the erstwhile AAR, New Delhi [now Customs Authority for Advance Ruling (CAAR), New Delhi], is wrong and devoid of merit as the applicants were well aware about the ongoing investigations being conducted by the officers of DRI who are also the officers of Customs; the applicant had suppressed the facts of pending investigation before the officers of DRI in their application filed before the CAAR, New Delhi. In the Affidavit, DRI, gave a brief of the investigation conducted by DRI in the matter (e.g. recording of statements, search, sample collection, etc.) has been summarised. DRI has also alleged that the importer had not approached this Authority with clean hands; the importer had misrepresented the facts before the CAAR and had obtained the ruling fraudulently. Therefore, the advance ruling pronounced should be declared ab initio void. 7. However, the applicant in their written submissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Commissioner of Customs or otherwise, that an advance ruling pronounced by it under sub-section (6) of Section 28-I has been obtained by the applicant by fraud or misrepresentation of facts, it may, by order, declare such ruling to be void ab initio and thereupon all the provisions of this Act shall apply to the applicant as if such advance ruling had never been made. In consultation with CAAR,. Mumbai, it is held that the scope of the aforesaid section as to who could represent to this Authority regarding alleged fraud or misrepresentation of fact by the applicant to obtain the advance ruling is wide enough to include officers of customs who may come to suspect such alleged fraud or misrepresentation of fact by the applicant. 9.2 In the instant case, it is the allegation of DRI, New Delhi that the applicant has engaged in such fraud or misrepresentation of fact by not disclosing the fact about ongoing investigation by DRI, New Delhi in their application. It is argued that had the same been disclosed, the application would have been hit by proviso (a) to Section 28-I(2) of the Customs Act, 1962 which prescribes that the Authority shall not allow the application where the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith something of value or to surrender a legal right. Clearly, the alleged act of omission of not elaborating on the details of DRI, New Delhi investigation by the applicant even if it were to be accepted would not be covered under the meaning of fraud. In the same vein, I do not find any misrepresentation of fact by the applicant, noting further that this authority had also ascertained from DRI Jaipur whether any SCN had been issued and they had replied in the negative. 9.6 Let us for argument sake consider the course of events that would have been followed by this Authority had the applicant made a fuller disclosure regarding the ongoing investigation by DRI, New Delhi (noting that the applicant states that they were not aware of the continuation of such investigation). Noting the indisputable facts that the previous clearances had been allowed finally, i.e. without recourse to provisional assessment by the jurisdictional customs officers and no pre-consultation notice or show cause notice had been issued by any of the competent authority, this Authority would not have invoked the proviso (a) to Section 28-I(2) of the Customs Act, 1962. In a recent ruling in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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