LexM/S. SANGHVI RECONDITIONERS PVT. LTD. versus UNION OF INDIA AND ORS.
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A B [201 O] 2 S.C.R. 352 M/S. SANGHVI RECONDITIONERS PVT. LTD. v. UNION OF !NOIA AND ORS. (Givil Appeal No.1435 of 2003) FEBRUARY 05, 2010 [D.K. JAIN AND T.S. THAKUR, JJ.] Customs Act, 1962 - ss. 1278 and 127C "'- Settlement - Duty exemption notification - Appellant-importer suppressed C facts to clandestinely avail benefit of the notification - Demand of duty by Commissioner of Customs besides ;Penalty and interest - AppeJJ.ant filed application for settlement - Settlement Commission confirmed the order of adjudication by Commissioner, but waived penalty and interest and also o granted total immunity to appellant from prosecution-- Still aggrieved, appellant filed writ petition and sought to urge additional ground relating to applicability of ss. 54 and 69 - High Court did not permit appellant to urge the additional ground and confirmed the order of Settlement Commission E - Justification of - Held: On facts, justified - The order of Settlement Commission did not suffer from any error, legal or factual - Having opted to get their customs duty liability settled by the Settlement Commission, appellant cannot be permitted to dissect the Settlement Commission's order with F a view to accept what is favourable to it and reject what is not - Additional ground sought to be raised before the High Court was not only an afterthought, adjudication thereon involved . investigation into facts and, therefore, the decision of High Court in not entertaining the additional ground did not suffer G from any infirmity - Customs Tariff Act, 1975 - Exemption Notification No. 211183-Cus dated 23rd July, 1983, as amended - Constitution of India, 1950 - Art. 226. Circulars/ Government Orders/ Notifications - Exemption Notification - Interpretation of - Held: Exemption Notifications H 352 SANGHVI RECONDITIONERS PVT. LTD. v. UNION OF 353 INDIA AND ORS. have to be strictly construed - A person claiming benefit of A exemption notification, must show that he satisfies the eligibility criteria. It was alleged that the appellant-importer, a registered ship repair unit, clandestinely availed the benefit of import 8 duty Exemption Notification No.211183-Cus dated 23rd July, 1983, as amended, on import of multiple consignments of engineering cargo as "ship spares". The Commissioner of Customs demanded customs duty of Rs.68.78 lakhs besides penalty, as also interest C under Section 28AB of the Customs Act, 1962. Appellant filed appeal before the Tribunal, but later withdrew the same and thereafter filed an application under Section 1278 with the Settlement Commission, disclosing and admitting a duty liability of Rs.20.98 lakhs. The Settlement D Commission called for the statutory report from the ·. Jurisdictional Commissioner in terms of Section 127C of the Act. Upon consideration of the information furnished by the Commissioner, particularly the fact that the appellant had given details of the "consignee" as the ship E owners, without disclosing the sale of imported "spare parts" to one Mis Elektronik Lab, the Settlement Commission was satisfied'.that there was suppression of facts on the part of the appellant so as to avail the benefit of duty exemption fraudulently. F Finally, concluding that the Revenue had been able to produce documentary evidence showing sale of imported "spare parts" by the appellant to Mis Elektronik Lab, who in turn sold the same items to ship owRers, the appellant could not claim any benefit under exemption G Notification No.211/83, the Settlement Commission sustained the demand of duty of Rs.68.78 lakhs. Howeve.r, inter alia, observing that though the appellant had not H 354 SUPREME COURT REPORTS [201 O] 2 S.C.R. A made a full and true disclosure of their duty liability but had cooperated with the Settlement Commission, the Settlement Commission waived penalty in excess of Rs.18 lakhs and granted total immunity to the appellant from prosecution. The Settlement Commission also held B that since the case of the appellant pertained to a period prior to April, 1995, when Section 28AB of the Act was inserted by the Finance Act, 1996, interest on delayed payment of duty could not be levied on the appellant. The appellant filed writ petition before the High Court, C and later filed an application for amendment of the writ petition, seeking to urge an additional ground to the effect that some of the consignments of "spare parts" having bee
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