KAMAT PRINTERS PVT LTD Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioners are aggrieved by the action of the Settlement Commission directing payment of interest. The submission on behalf of the petitioners has been that no show cause notice as required under Section 28 of the Customs Act, 1962 (hereinafter referred to as the Act) was served on the petitioners. The show cause notice dated 16th June, 2000 only demanded duty and not interest. It is submitted that considering the provisions of Section 127C of the Customs Act, 1962 as the issue of interest was not the subject of the case, the Settlement Commission in directing the petitioners herein to pay interest acted without jurisdiction.

(2.) A few facts may be stated. The petitioner had imported one Heidelberg Offset Colour printing machine from Germany. The same was purchased through a known person by name Mr. Rajeev Batra of Delhi, who was also in the printing business and deals in purchase and sale of printing machines. According to the petitioner No. 2 an amount of Rs. 3,80,000/was paid to Shri Rajeev Batra as his commission for arranging purchase and shipment of 72 V speed master printing machine with CPC of 1980 Model available for GBP 55,000. The petitioners were given the certificate dated 29th March, 1999 from M/s.Machinehandel Presto Type Ronde Tooht, 2, Zhandam stating that machine of 1978 sold to them was in good working condition and that the market value of new machine of manufacture in the year 1978 is of Pounds 1,35,000/and the present value of Pounds 55,000/is very reasonable. The machine was thereafter shipped and received by the petitioner and installed on the petitioners unit in the 2nd week of June, 1999.

(3.) The respondents issued a show cause notice based on intelligence that the petitioners had imported and cleared an old and used offset colour printing machine in contravention of the restriction imposed on the import of old and used machines. The petitioners by the show cause notice were informed as to why the value set out in the Bill of Entry should not be rejected and the value redetermined as Rs. 83,86,611/under the provisions of Rule 8 of the Valuation Rule, 1988 read with Section 14(1) of the Customs Act, 1961. Penalty was also proposed.