2021-TIOL-724-HC-AHM-ST
Arcadia Developers Vs UoI
ST - A show cause notice was issued to the writ applicants dated 24th April 2019 raising issues of computation of service tax liability - While the writ applicants were expecting notice for being granted opportunity of personal hearing as promised, the 2nd respondent straightway proceeded to pass the impugned order dated 11th November 2019, wherein the proposed demand in the show cause notice has been confirmed on the ground that the writ applicants have not produced documentary evidences and they have not been able to reconcile the figures of returns with the books of accounts; therefore, the writ petition.
Held : Bench is of the view that it should give one opportunity to the writ applicants to make oral submissions and offer appropriate explanation to the various queries raised in the show cause notice - The impugned order dated 11th November 2019 is hereby quashed and set aside and the entire matter is remitted to the adjudicating authority (respondent No.2) for fresh adjudication after giving an opportunity of hearing to the writ applicants on the condition that the writ applicants shall make a pre-deposit of the sum of Rs.9,21,490/-, which is 7.5% of the net tax demand as per the impugned order - entire exercise be undertaken and completed within a period of two months: High Court [para 13, 15]
- Petition disposed of : GUJARAT HIGH COURT
2021-TIOL-723-HC-MUM-CUS
Syska Led Lights Pvt Ltd Vs UoI
Cus - Petitioner seeks quashing of order dated 23.09.2020 passed by the Joint Commissioner of Customs i.e., respondent No. 3 and further seeks a direction to the respondents to release the imported goods - However, as per order of this Court dated 03.11.2020, the imported goods have been released on the petitioner furnishing bank guarantee for the amount of customs duty declared in the Bill of Entry No. 8311310 dated 28.07.2020 as well as covering the redemption fine and penalty imposed vide the impugned order in original dated 23.09.2020 - Though the goods were confiscated, option was given to the petitioner to redeem the same on the payment of redemption fine, besides imposing penalty.
Held: Admittedly in this case, no notice in writing under section 124(a) of the Customs Act was given to the petitioner before passing the impugned order in original which not only confiscated the goods but also imposed penalty on the petitioner - All that the impugned order in original says is that a personal hearing was given to the authorized representative of the petitioner on 18.09.2020 through video conferencing. There is nothing on record to show or indicate that a request was made on behalf of the petitioner for oral notice or oral representation - From a reading of the impugned order in original, it does not appear that the procedure laid down for rejection of declared value and redetermination of value was followed - It is a settled proposition that when a law requires a thing to be done in a particular manner, it has to be done in the prescribed manner and proceeding in any other manner is necessarily forbidden - It is quite evident that the impugned order in original stands vitiated due to statutory infraction as above leading to violation of the principles of natural justice thereby vitiating the impugned order-in-original - Where there is a breach of principles of natural justice, existence of an alternate remedy of appeal would be no bar to exercise of jurisdiction under Article 226 of the Constitution of India - Impugned order in original dated 23.09.2020 is set aside and the proper officer is directed to proceed with the matter afresh, if he is so inclined, by following the mandate of section 124 of the Customs Act and Rule 12 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 - Writ petition is accordingly allowed: High Court [para 20, 23, 24, 25, 27, 29]
- Petition allowed :BOMBAY HIGH COURT
2021-TIOL-721-HC-MUM-CX
Essel Propack Ltd Vs UoI
CX - CENVAT - CESTAT vide order dated 27.09.2018 = 2018-TIOL-3214-CESTAT-MUM had held that petitioner had made mis-statement and thus practised fraud; that since the documentary evidence produced before the Bench has no connection with the actual transactions made by appellant but those appear to have been created for the purpose of meeting the law, the appeal is dismissed and the impugned order in appeal is confirmed - Miscellaneous application filed was not only dismissed by CESTAT vide the impugned order dated 28.08.2019 but it also imposed cost of Rs.10,000.00 on the petitioner.
Held:
++ It is quite evident that fraud has serious civil as well as criminal consequences. To constitute the offence of fraud there must be intent to deceive. That apart, a finding of fraud is a stigma which is a reflection on the integrity of a person or of a corporate entity. [para 18]
++ It is a settled proposition of law that fraud vitiates every solemn act. An order or decree or benefit obtained by playing fraud is a nullity and such an order, decree or benefit can be challenged at any time in any proceeding. [para 20]
++ To constitute fraud there must be an intent to deceive. When an allegation of fraud is made, it must be enquired into. Enquiry would necessarily mean granting reasonable opportunity of hearing to the party accused of committing fraud. Evidence must be led and thereafter fraud must be proved. No conclusion of fraud can be drawn on mere allegation and by way of inference. [para 22]
++ The basic allegation against the petitioner pertaining to availing of CENVAT credit on account of labour services as could be discerned from the notice to show cause-cum-demand dated 23.12.2015 was that the services for which the CENVAT credit was availed of was not connected with the manufacturing activities of the petitioner. [para 23]
++ It is clearly evident that petitioner's availment of CENVAT credit was being denied by the adjudicating authority on merit and not on the ground that the invoices were manufactured or manipulated. [para 24]
++ Even the adjudicating authority did not make any comment or statement about the veracity of the invoices. The CENVAT credit were partly allowed on merit. Same is the position in the order-in-appeal dated 30.10.2017 passed by the Commissioner (Appeals). [para 25]
++ Relying on section 73 of the Indian Evidence Act, 1872, CESTAT compared the handwriting and signature on the two invoices and was satisfied that those were tampered with. Thereafter, it was observed that fraud was practised by the petitioner. Thus, the miscellaneous application was rejected with cost of Rs.10,000.00. [para 27]
++ On such a haphazard and hurried basis without any conclusion having been reached as to the intent to deceive, no finding of fraud could have been reached by the CESTAT. Thus, fraud cannot be said to have been proved; it was merely alleged and an inference of fraud was drawn. Therefore, CESTAT was not justified in rejecting the application filed by the petitioner for recalling the finding of fraud and additionally in imposing cost. [para 28]
++ Consequently, Bench sets aside the said order in its entirety and also expunges the finding of fraud against the petitioner recorded by CESTAT in its order dated 27.09.2018 = 2018-TIOL-3214-CESTAT-MUM . [para 30]
- Petition disposed of : BOMBAY HIGH COURT |
