FAMINA KNIT FABS Vs. UNION OF INDIA

JUDGEMENT

(1.) This order shall dispose of CWP No.22829 and 25370 of 2018, as according to the learned counsel for the petitioner, the issue involved in both the petitions is identical. However, the facts are being extracted from .

(2.) has been filed by the petitioner under Articles 226/227 of the Constitution of India for quashing the order dtd. 8/8/2018, Annexure P.13 whereby respondent No.3 -Additional Commissioner of Customs (Export), New Delhi has confirmed demand of duty drawback even for the period prior to five years. Further prayer has been made for stay of the impugned order during the pendency of the present writ petition.

(3.) A few facts relevant for the decision of the controversy involved as narrated in may be noticed. The petitioner - a partnership concern having its office at Ludhiana is engaged in the manufacture and export of readymade garments. The petitioner unit was established in the year 1996 and started export in the year 2000. The petitioner as per prescribed procedure, exported goods claiming benefit of drawback in the shipping bill itself. Material was physically examined, samples were drawn, value was assessed and thereafter permission to export was granted. Report was countersigned by Assistant/Deputy Commissioner of Customs. In many cases, value for the purpose of drawback was ordered to be reduced. On 31/12/2012, officers of respondent authorities examined and detained goods of the petitioner lying at ICD, Tughlakabad, New Delhi. The respondent authorities examined 848 corrugated boxes having men's T- shirts of different sizes and thereafter vide panchnama dtd. 31/12/2012 detailed the said boxes. The petitioner requested for release of the said containers. Vide letter dtd. 20/2/2013, Annexure P.4, the respondents provisionally released the containers subject to furnishing of bond. The respondents conducted market enquiry with respect to 9 shipping bills and found that market price of goods was Rs.2.28 crores though declared value was Rs.4.71 crores. The petitioner continued to export goods post search. The customs authorities permitted export of goods but did not release duty drawback benefit on account of direction issued by Directorate of Revenue Intelligence (DRI). The petitioner visited the office of DRI with a request to release duty drawback benefit. The DRI called a report from the office of Customs who vide report dtd. 21/5/2013 confirmed that they had 100% examined consignments of the petitioner. The petitioner filed CWP No.20206 of 2013 in this court seeking directions to DRI and Customs authorities to release drawback benefits. Vide order dtd. 12/9/2013, Annexure P.7, this Court directed DRI, Ludhiana to decide claim of the petitioner. Vide letter dtd. 17/10/2013, Annexure P.8, the DRI informed the petitioner that they had issued no objection certificate to the customs. Accordingly, the customs authorities released duty drawback benefits. During search, the DRI recovered print out of few emails which indicated that the petitioner had issued parallel invoices showing value of goods lower than the value declared before customs. As per overseas report, the value declared before Indian customs was 3 to 17 times more than the value declared before UAE customs. Respondent No.3 on the basis of investigation concluded that the petitioner had misdeclared value of the goods and wrongly availed duty drawback. Vide show cause notice dtd. 11/9/2017, Annexure P.9, respondent No.3 called upon the petitioner to show cause as to why drawback to the tune of Rs.16,66,01,985.00 should not be recovered from the petitioner. The demand had been raised for the period from 2010-11 to December 2012. The petitioner filed CWP No.38 of 2018 before this Court seeking quashing of show cause notice on the ground that demand could not be raised beyond reasonable period and it could not be more than five years. The said petition was disposed of vide order dtd. 8/1/2018, Annexure P.10 with liberty to the petitioner to contest the show cause notice and also to make an application before the authority to decide the issue of limitation as a preliminary ground. The petitioner filed letters dtd. 12/5/2018 and 21/6/2018, Annexures P.11 and P.12 pointing out the findings of this court on the question of limitation. According to the petitioner, respondent No.3 decided the matter on merits without informing the petitioner. The show cause notice was upheld and the question of limitation had been mechanically disposed of. The demand was confirmed even beyond five years. Hence the instant petitions by the petitioner.