ORDER
S.S. Kang, Member (J)
1. Heard both sides.
2. Brief facts of the case are that, the appellants in view of Public Notice No. 29/86, dated 29-4-1986 are custodian of detained/mishandled baggage to be stored pending clearance/re-export/disposal. Certain goods were handed over to the appellants by the Customs authorities in the year 1993 and the same were returned to the Customs authorities in the year 1996. The present show cause notices were issued to the appellants on 18-9-1998 on the ground that the goods handed over to the appellants were found short and, therefore, they are liable to pay the price of the short goods as well as the customs duty. The adjudicating authority ordered the recovery of the value of the goods and the customs duty. The appellants filed the appeal and
the Commissioner (Appeals) in the impugned order held that there is no provision under the Customs Act to recover the value of the goods and upheld the order in respect of the demand of customs duty.
3. The contention of the appellants is that, the goods were handed over to them in the year 1993 bearing the seal of the Customs authorities. The goods were returned to the Customs authorities on their demand in the year 1996, and at that time, the Customs authorities had not raised any objection in respect of the tampering of the seal or in respect of the shortage of the goods. Therefore, after two years i.e. on 18-9-1998, the show cause notices were issued on the ground that condition No. 8 of the Public Notice No. 29/86 is violated. In the show cause notices, no provision of Customs Act was invoked and only an averment was made that they had violated the provisions of Customs Act. The adjudicating authority invoked the provisions of Section 45(3) of Customs Act. The contention of the appellants is that, the Customs authorities are not sure under which provision of law the duty can be demanded. The contention of the appellants is also that, the adjudication order as well as the order-in-appeal are beyond the scope of the show cause notices.
4. The contention of the Revenue is that, the goods were handed over to the appellants for safe custody on certain conditions of Public Notice No. 29/86 wherein one of the conditions (condition No. 8) was that the custodian shall be held responsible for any loss, pilferage and damage to the packages kept in their custody. Therefore, the appellants are liable to pay the customs duty.
5. In this case, the goods were handed over to the appellants in the year 1993 which were taken back in the year 1996. At the time of returning of the goods, there was no averment of the revenue that the goods were short or tampered with. On 18-9-1998, show cause notices were issued alleging shortage of the goods. In these circumstances, it cannot be said that the goods were lost during the custody by the appellants or after handing over to the Customs authorities and before issuance of the show cause notice. Therefore, the demand of customs duty from the appellants is unsustainable.
6. In respect of the plea of the appellants that the adjudication order as well as the order-in-appeal is beyond the scope of the show cause notice, the reading of show cause notice shows that no provisions of Customs Act were invoked. Only it was mentioned that they had contravened the provisions of Customs Act. No particular section was mentioned in the show cause notice. The adjudicating authority invoked the provisions of Section 45(3) of the Customs Act, and the Commissioner (Appeals) had not upheld the demand under Section 45(3) of Customs Act, but invoked the provisions of Section 142(2) of the Customs Act. The provisions of Section 142(2) of the Customs Act relate to ‘Recovery of sums due to Government’. The section provides that where the terms of any bond or other instrument executed under this Act or any rules or regulations made thereunder provide that any amount due under such instrument may be recovered in the manner laid down in Sub-section (1), the amount may, without prejudice to any other mode of recovery, be recovered in accordance with the provisions of subsection (1) of Section 142 of the Customs Act. In the present case, there is no bond executed by the appellants and, therefore, the provisions of Section 142
are not applicable to the facts and circumstances of the present case and this provision was not invoked in the show cause notice. Therefore, the impugned order is also beyond the scope of the show cause notice.
7. In view of the discussion made above, the impugned order of the Commissioner (Appeals) is set aside and the appeals are allowed.