Prime Mineral Exports Pvt. Ltd. vs C.C. and C.E.

Ghulam Mohammed, J.—This writ petition is filed seeking to quash, by way of Certiorari, the order passed by the first Respondent in Order-in-Appeal No. 56/2008(V-II) CUS., dated 22-9-2008.

The brief facts of the case are as follows:

Petitioner is a company engaged in the business of export of iron ore fines and in that process it filed shipping bill bearing No. 32, dated 27-8-2007 before the second Respondent for the export of 41308 MTs of 61% Iron Ore Fines and also paid duty at the rate of Rs. 50/- per MT in terms of Notification No. 62/2007 -CUS. dated 3-5-2007 which provides for concessional rate of export duty for export of Iron Ore of Fines of Fe content 62% and below. The second Respondent assessed the shipping bill provisionally on payment of duty at the rate of Rs. 50/- per MT pending test report on the basis of PD bond submitted by the Petitioner undertaking to pay differential duty along with interest in case the Fe content is found to be more than 62% on test by the Customs House. Petitioner also submitted bank guarantee for Rs. 1,03,27,000/- covering the differential duty. The sample drawn by the second Respondent was analyzed in the Customs House Laboratory and it was found that the Fe content of the sample is above 62%. The Petitioner is not furnished with a copy of the test report. The Petitioner disputed the analysis report of the Customs House Laboratory and the second Respondent by the order dated 17-3-2008 in order-in-original No. 2/2008 confirmed the demand of differential duty and, though the appeal provision u/s 128 of the Customs Act, 1962 (for short - ''the Act''), provides for a period of 60 days from the date of communication of the orders, issued a letter to the Petitioner''s banker to encash the bank guarantee. Aggrieved thereby, the Petitioner filed Writ Petition No. 6956 of 2008. This Court by the order dated 31-3-2008 .disposed of the said writ petition directing the Respondents therein not to give effect or take any coercive steps, in any manner, whatsoever, in pursuance of the said orders passed in Original No. 2 of 2008 dated 17-3-20078 till 27-5-2008, including the encashment of the bank guarantee. Thereafter, the Petitioner company preferred appeal No. 23/2008 (V-II)-CUS. before the first Respondent and also filed a stay application. The second Respondent, being aware of the fact that an appeal was preferred and a stay application was also filed before the first Respondent, issued a notice on 6-6-2008 in SB. No. 32/27-8-07-1614 directing the Petitioner''s banker to encash the bank guarantee. Aggrieved thereby, the Petitioner addressed a letter to the first Respondent requesting to fix-up a day for hearing of the stay application as well as the appeal. As the first Respondent had not fixed any date for hearing of the stay petition, the Petitioner filed W.P. No. 13973 of 2008 seeking to restrain the second Respondent from encashing the bank guarantee till the first Respondent disposes of the stay application and the appeal filed by the Petitioner. By the order dated 1-8-2008 this Court disposed of the said writ petition directing the first Respondent to dispose of the interim application and also the main appeal on merits in accordance with law within a period of four weeks from the date of receipt of a copy of such order. The first Respondent in pursuance of the orders of this Court in W.P. No. 13973 of 2008 issued a letter dated 12-8-2008 to the Petitioner fixing the date of hearing of the stay application as 27-8-2008 which was received by the Petitioner on 20-8-2008 for which the Petitioner addressed a letter dated 22-8-2008 to the first Respondent informing about the inconvenience to appear on 27-8-2008 and requested to fix the next date of hearing on 19-9-2008 or any other date convenient to the first Respondent. The first Respondent without issuing any further communication fixing the next date of hearing and without giving an opportunity of personal hearing to the Petitioner passed the impugned order.

Heard the learned Counsel for Petitioner and Sri A. Rajasekhara Reddy, the learned Assistant Solicitor General for Respondents.

The learned Counsel for Petitioner has drawn our attention to Section 128A of the Act and contended that the first Respondent has failed to comply with the procedure contemplated in Section 128A of the Act and thereby failed to comply with the principles of natural justice and passed the impugned order without giving an opportunity of being heard to the Petitioner even though it expressed its desire to be heard. On the other hand, the learned Counsel for Respondents contended that the first Respondent has duly intimated the date of hearing of the appeal and directed the Petitioner to be present on the date of hearing and so the question of not affording an opportunity of being heard to the Petitioner does not arise.

As per Section 128A(1) of the Act the Commissioner (Appeals) shall give an opportunity to the Appellant to be heard if he so desires. When the statute itself provides an opportunity of being heard to the Appellant the first Respondent cannot deny such right and pass the impugned order.

Having regard to the facts and circumstances of the case, the order passed by the first Respondent in Order-in-Appeal No. 56/2008(V-II)-CUS., dated 22-9-2008 is set aside and the matter is remitted to the first Respondent with a direction to decide the matter afresh in accordance with law within a period of four weeks from today after affording an opportunity of being heard to the counsel for Petitioner. However, the counsel for Petitioner is directed to appear before the first Respondent within a period of two weeks from today duly informing the convenient date to the first Respondent.

With the above observations, the writ petition is disposed of. No order as to costs.