VIMAL INTERNATIONAL Vs. COMMISSIONER OF CUSTOMS

JUDGEMENT

(1.) THIS appeal has been filed by the appellants against the impugned order dated 20 -9 -2001 passed by the Commissioner of Customs vide which he had extended time limit of another six months under Section 110(2) of the Customs Act, for serving show cause on the appellants, under Section 124 of the Act.

(2.) THE appellants through two shipping bills both dated 7 -9 -2000 sought export of 250 CDs. each containing software of jewellery design and mahendi arts. The total value of the software CD was declared as US 1,90,000. However, on suspicion that there may be over -valuation of the CDs., the search of the office premises of the appellants was conducted on 13 -9 -2000 and the relevant documents were seized for the purpose of investigation. During investigation, the department suspected prima facie case of over valuation and did not allow export of 250 CDs. It further revealed that earlier also the appellants had exported 250 identical CDs. in July, 2000. The Investigating Officer accordingly sent a letter to the appellants' bank for not allowing payment of any remittance/sale proceeds of the software CDs exported in July, 2000. The appellants, however, filed a Writ petition in the High Court of Gujarat against the department's action of not allowing the export and also against the letter of Deputy Commissioner of Customs for not allowing withdrawal of the remittance/sale proceeds relating to the export of software CDs. made in July, 2000. High Court vide its order dated 27 -12 -2000 directed the department to allow export provisionally on execution of bond by the appellants, as per law. Accordingly, the appellants were allowed to export CDs on 12 -1 -2001 on execution of bond of full declared value of software CDs and bank guarantee of Rs. 2,00,000/ -. That order was again challenged by the appellants before the Hon'ble High Court of Gujarat. But meanwhile on 2 -2 -2001 foreign remittance/sale proceeds amounting to Rs. 21,95,700/ - arrived and was credited in the account of the appellants. In the Writ Petition, the department, however, agreed to withdraw the letter for not allowing the withdrawal of the remittance, without prejudice to their right to take necessary action including seizure of the sale proceeds. The Writ petition was then withdrawn by the appellants. The department vide letter dated 31 -3 -2001 effected the seizure of the sale proceeds. This action of the department was again questioned by the appellants through Writ petition in the High Court. But in the meanwhile, on the request of the appellants, the Commissioner of Customs allowed the release of the seized currency on bond and bank guarantee, which was furnished by them.

(3.) SINCE , due to lengthy investigation, show cause notice could not be served on the appellants within time, the department requested for extension of time under proviso to Section 110(2) of the Customs Act. On receipt of this request, notice was issued to the appellants and thereafter, the Commissioner of Customs passed the impugned order extending time limit by another six months i.e. up to 19 -3 -2002 for completion of investigation and issuance of notice under Section 124 of the Customs Act.