ORDER
J.H. Joglekar, Member (T)
1. These six appeals relate to and arise out of the single order passed by the Collector of Customs, Mumbai. These are, therefore, disposed of vide this common roder.
2. M/s. Orkay Silk Mills Ltd. (hereinafter called Orkay) imported Polyester Chips declaring them to be of Yugoslavian orign and claiming concessional rate of duty. The goods were allowed provisional clearance at the concessional rate of duty. Subsequent investigation showed that the goods were of Italian origin and were in fact loaded at a Port in Italy. Show cause notice dated 24.10.86 was, therefore, issued seeking recovery of differential duty amounting to Rs. 1,06,53,744/- and seeking imposition of penalities upon M/s. Orkey Silk Mills Ltd., their Chairman, Managing Director and other Directors as well as on M/s. Shipping Corporation of India and M/s. H.Saleix & Co. M/s. H.Saleix & Co. was the indenting agent and the Shipping Corporation of India was the carrier of the goods. Allegations were also made that on ht eground of mis-declaration, the goods were liable to confiscation. After hearing the concerned persons, the Commissioner came to the conclusion that thee was no evidene produced that M/s. Orkay Silk Mills Ltd. or their Directors and employees had any part to play in the mis-declaration as to the source of the goods. On this ground, he refrained from imposing penalties upon them. As regards the indenting agent he observed that they had organised for import of teh good of Yugoslavia origin from a Yoguslavian Port. He, therefore, did not impose any penalty upon them. He also held that there was no sufficient evidence to hold that SCI were guilty of any omission and commission. He did not impose any penalty upon them. In passing the order, he mentioned that the whole episode seemed to have originated from the overzealous commercial adventure of the overseas agents of Shipping Corporation of India. He, however, confirmed the duty and directed recovery of the differential duty. This order was reviewed by the Central Board of Exice & Customs under powers vested in them in terms of Sec. 129D(1) of the Customs Act, 1962. It was urged that there was sufficient evidence to show that the concerned persons viz. the noticees were involved in creating the fraud by taking undue advantage of the Notification providing concessional rate of duty for goods of Yugoslavian origin. Prayer was made for determination on this point.
3. The ld. DR at the outset was asked whether any permission had been obtained by the Revenue to pursue the appeal filed against the Shipping Corporation of India. The Minutes of the Meeting of the Empowered Committee dated 11.8.97 as recorded by the Cabinet Secretary was placed before us and we are satisfied that the requisite clearance had been obtained to pursue the appeal. We have also seen the application for condonation of delay in filing of the supplementary appeals where the initial appeal filed was a joint appeal. We have condoned the delay in filing of the supplementary appeal.
4. The counsels for the Shipping Corporation of India were present. The other respondents were not represented in spite of sufficient notice.
5. We have heard the departmental representative and the counsels for the Shipping Corporatin of India. It was submitted that from the show cause notice, it was evident that at the time of issue of show cause notice, the assessment was provisional. It was submitted that while the assessments were provisional, show cause notice could not be issued under Sec. 28(1) of the Customs Act. We have seen the show cause notice and find reference therein to support the claim that at the time of issue thereof the assessments were in fact provisional.
6. In a number of decisions, it has been held that in such a situation, show cause notice issued under Sec. 11A would not survive. The provisions of Sec. 28(1) of the Customs Act being similar in wording and content, the ratio of the judgements would apply in those cases where the notices are issued under Sec.28(1) of the Customs Act also.
7. The Bombay High Court judgement in the case of Godrej & Boyce Ltd [1989(43) ELT 225 BOM] holding so was taken before the Supreme Court and the Supreme Court declined to intervene. The Madras High Court in their decision in the case of Ponds India Ltd. [1944(73) ELT 272] had also held so. The Calcutta High Court in the case of Nayek Paper Industries Ltd. [1991(56) ELT 31(Cal) and the Madras High Court in the case of Madura Coats Limited [1995(79) ELT 567 have also held so. These judgements were followed by the Tribunal in a number of judgements including in the case of Serene Industries Ltd. [2000(123) E.L.T. 909. All these judgements were passed taking into account the different view held by the Delhi High Court in the case of Duncancs Agro Industries Ltd [1989(39) ELT 51(Del.). In fact these judgements had been cited before the Bombay High Court in the first cited case.
8. The judgement of the Supreme Court in the case of Serai Kella Glass Works Pvt. Ltd. [1997(91) E.L.T. (S.C) in paragraph 17 and 18 very clearly laid down that where the assessments are provisional, the show cause notice itself was not warranted. Therefore, the question of non levy of penalty by the Commissioner, although on different grounds, challenged by the Revenue before us, does not arise.
10. Since, the non levy of penalty is the only ground before us, we find no merit in these appeals and, therefore, dismiss the same.
(Dictated in Court)