Legal principle

Where a revenue statute like the Customs Act constitutes a complete code and provides an efficacious special remedy such as the Section 128 appeal, the writ court will not normally entertain an Article 226 petition merely because the appellate authority cannot remand under Section 128A(3), and a Settlement Commission application under Section 127B must be made before adjudication is completed, not after.

Court decision

The Calcutta High Court dismissed the writ petition, holding there was no breach of natural justice, the adjudication procedure was lawful, the statutory appeal under Section 128 was an efficacious alternative remedy notwithstanding Section 128A(3), and the Settlement Commission could not be approached after adjudication. The petitioner was granted liberty to appeal within four weeks with the benefit of Section 14 of the Limitation Act, with the Appellate Authority to decide on merits, permit filing of a reply to the show-cause notice, and dispose of the appeal preferably within six months.

Facts

The petitioner imported a right-hand drive Hummer H2 SUV in 2007 on concessional duty arranged through one Kailash Palany. A show-cause notice dated 13 September 2012 under Section 124 read with the proviso to Section 28 alleged the vehicle was converted from left-hand to right-hand drive and had changed hands before import, making it ineligible for concessional duty, and proposed recovery of differential duty of Rs. 25,91,844 with interest, confiscation under Sections 111(d) and (m), and penalties under Sections 114A and 114AA. The petitioner sought adjournments, paid the differential duty and interest by demand drafts stating he intended to approach the Settlement Commission, but never actually filed the settlement application. The Additional Commissioner passed an ex parte order on 11 June 2013 ordering confiscation, differential duty, an equal penalty and a further penalty of Rs. 2 lakhs, which the petitioner challenged by writ petition.

Key provisions

• Section 127B, Customs Act, 1962 — Application for settlement of cases
• Section 127A, Customs Act, 1962 — Definitions
• Section 122A(2), Customs Act, 1962 — Adjudication Procedure
• Section 128A(3), Customs Act, 1962 — Procedure in appeal
• Section 127(1), Customs Act, 1962 — Award of confiscation or penalty by customs officers not to interfere with other punishments
• Section 124, Customs Act, 1962 — Issue of show cause notice before confiscation of goods etc
• Section 111, Customs Act, 1962 — Confiscation of improperly imported goods etc