CHAPARRAL HEALTH SERVICES LIMITED Vs. UNION OF INDIA

JUDGEMENT

(1.) A show-cause notice does not by itself determine any right or obligation. It simply gives to the party receiving the same an opportunity to state its case and oppose the action proposed in the notice. The notices impugned in these petitions also do the same. They call upon the petitioners to explain why action in terms proposed in the notices be not initiated against them. The petitioners can in response urge all such grounds on facts and in law as may be open to them and argue that the proposed action is either impermissible in law or unwarranted on facts. There is in that view no justification for this court to intervene at this stage and short-circuit the process set in motion by the respondents in exercise of the statutory powers vested in them.

(2.) COUNSEL for the petitioner all the same argued that the notices were without jurisdiction, inasmuch as notification No. 64/88-cus issued under Section 25 of the Customs Act, by which hospital equipments, apparatus and appliances including spare parts and accessories thereof were exempted from the payment of customs duty upon their import from outside the country had been repealed by a notification dated 1st of march, 1994 without making any provision for recovery of customs duty or confiscation of the equipment in cases where the conditions subject to which the equipment was imported was found to have been violated. It was argued that in the absence of any saving clause in the repealing notification, the action initiated by the respondents for the confiscation of the imported equipment, recovery of the customs duty payable on the same and levy of interest and penalty was legally impermissible. Reliance in support was placed upon the decisions of the supreme court in mis. Rayala corporation (private) limited and another v the director of enforcement, New Delhi and kolhapur canesugar works limited v union of India.

(3.) IN M/s. Rayala corporation (private) limited's case, supra, one of the questions that arose for consideration was whether a prosecution launched for the violation of Rule 132-a was maintainable even after the repealing of the said provision. Answering the question in the negative, the Supreme Court held that in the absence of a specific provision permitting prosecutions for violations committed when the Rule was in force, no such prosecution could be launched after its omission from the statute book. The reasoning underlying that view is available in the following passage from that judgment.