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ADJUDICATION AND APPEALS
 

ADJUDICATION AND APPEALS

Contraventions of the provisions of the Customs Law and also the connected import/export and Foreign Exchange Laws are punishable by the Department. The Department is required to follow certain procedures before imposing any punishment under the Law. The procedures to be followed by the Department and the rights of the importer/exporter are detailed hereunder.

PROCEDURE FOR DEMAND OF DUTY/INTEREST

When duty has not been levied or short levied or erroneously refunded or interest not paid, part paid or erroneously refunded, a notice demanding the said duties/interest is required to be issued by the Department. {Section 28 of the Customs Act 1962)

Time Limit for issue of notice: Notice shall be issued within SIX MONTHS. In the case of any import made by individual for his personal use or by Government or by Education, Research or Charitable Institution or Hospital within ONE YEAR. In case of demand by reason of collusion or wilful statement or suppression of facts by importer / exporter within FIVE YEARS. Issue of show cause notice is mandatory where it is proposed to order confiscation of any goods or imposition of any penalty. (Section 124 of the Customs Act, 1962).

REQUIREMENTS OF A SHOW CAUSE NOTICE

    • The demand notice or show cause notice should give a clear description of the allegations and charges against the persons concerned.
    • It should give particulars of facts, which furnish the reason for issue of the demand notice or show cause notice.
    • All Rules or Sections of the relevant Acts, or notifications issued alleged to have been contravened should be clearly and specifically be quoted in the show cause notice.
    • All Rules and Sections of the relevant Acts under which the punishment or penalty, fine or confiscation etc., proposed to be imposed should be clearly and specifically be quoted in the show cause notice.
    • The show cause notice must disclose all the materials/evidence relied upon in making the allegations.
    • The show cause notice must be accompanied by copies of all documents relied upon.
    • An opportunity of personal hearing must be offered in the Show cause notice.
    • The time limit allowed to the person for reply to the show cause notice should be mentioned. Generally the period allowed should be ten days from receipt of the notice.
    • The show cause notice must give full designation and address of the authority to whom the written submission is to be made.

Note: The show cause notice can be oral at the request of the person concerned. The reply to show cause notice can also be oral at the request of the person concerned.

SERVICE OF SHOWCASE NOTICE

Service of show cause notice is through registered post or hand service to the person concerned or to his authorized agent. If the service of the notice is not possible by the said means the notice will be pasted on the premises of the noticee in the presence of witnesses and drawing up of a Panchanama / mahazar. If these attempts do not fructify, the notice is considered to be served by placing it on the notice board of the Range/Division/Customs House/ Commissionerate. {Section 153 of the Customs Act 1962}

ADJUDICATION

To adjudicate is to decide judicially some dispute as to what is right and what is wrong. The adjudication proceedings in Customs & Central Excise are known as quasi-judicial proceedings as the officers here are not fettered by strict compliance of judicial procedures laid down in the Criminal Procedure Code. However the Officers of Customs & Central Excise are required to act judicially and not arbitrarily.

POWERS OF ADJUDICATION

IN CASES WHERE EXTENDED PERIOD IS INVOKED:

DESIGNATION OF OFFICERS AMOUNT OF DUTY INVOLVED

COMMISSIONER NO LIMIT

ADDITIONAL COMMISSIONER RUPEES 20 LAKHS

JOINT COMMISSIQNER RUPEES 10 LAKHS

IN CASES WHERE EXTENDED PERIOD IS NOT INVOKED:

DESIGNATION OF OFFICERS VALUE OF GOODS INVOLVED

COMMISSIONER NO LIMIT

ADDITIONAL / JOINT RUPEES 20 LAKHS
COMMISSIONER

ASSISTANT / DEPUTY RUPEES 2 LAKHS
COMMISSIONER

GAZETTED OFFICERS OF RUPEES 10 THOUSAND
CUSTOMS LOWER IN RANK THAN
AN ASSISTANT COMMISSIONER

REQUIREMENTS OF AJUDICATION:

    • The adjudication authority shall follow the ‘principles of natural justice’. These principles are un-codified and are based on justice, equity, common sense, fair play and rule of law.
    • The adjudicating authority shall act without bias and should be impartial.
    • PERSONAL HEARING Before adjudicating a case, the person on whom a demand notice/show cause notice has been served must be heard and is not to be denied. The Adjudicating authority must himself hear the parties concerned. The adjudicating authority may permit the appearance of legal practitioners in complicated and important cases. A record of the personal hearing must be maintained. Adjournment of personal hearing to be considered reasonably by the adjudicating authority. Granting of ‘Personal hearing’ is an important tenet of ‘principles of natural justice’.
    • The order passed by an adjudicating officer must be a speaking order and requires reasoned decisions.

REQUIREMENTS OF AN AJUDICATION ORDER

    • Must contain a distinctive order number and the file number from which it is issued along with the date and the designation of the officer passing the order.
    • It must contain a preamble indicating the defence the provisions of appeal, the appellate authority and the time limit for appeal.
    • It must contain the brief facts of the case, the charges and evidence relating thereto.
    • The provisions alleged to have been contravened and action proposed in the notice.
    • The written submissions made, including the evidence tendered by the defence must be mentioned in the order.
    • The particulars of personal hearing needs to be mentioned
    • Analysis and findings of the adjudicating authority with reference to each charge indicating clearly whether a particular charge stands proved or not.
    • Finally the order of the adjudication authority quantifying duty liability, fine in lieu of confiscation and penalties.

APPEAL

The order passed by the adjudication officers are subject to appeal under the Act. The various stages of appeal are given in the table below.

Sl. No

Order passed by

Appellate authority

Time limit

1.

All officers upto & including Additional Commissioner

Commissioner (Appeals)

60 days from the date of communication of the order

2.

Commissioner or Commissioner (Appeals)

CESAT except in cases where order relates to

  1. Any goods imported or exported as baggage;
  2. Any goods loaded in a conveyance for importation into India, but which are not unloaded at their place of destination in India, or so much of the quantity of such goods as has not been unloaded at any such destination if goods unloaded at such destination are short of the quantity required to be unloaded at that destination;
  3. Payment of drawback as provided in Chapter X and the rules made thereunder;

3 months from the date of communication of the order

3.

Commissioner or Commissioner (Appeals)

Revision application to Central government (in matters relating to baggage, drawback, export without payment of duty, goods short landed, loss of goods in transit). No further appeal.

3 months from the date of communication of the order

4.

CESAT

Supreme court (Classification and valuation cases)

180 days from the date of communication of the order

5.

CESAT

High Court (other than classification and valuation matters)

180 days from the date of communication of the order

6.

High Court

Supreme court

60 days from the date of communication of the order


APPEAL TO COMMISSIONER (APPEALS):

Any person aggrieved by the order of an officer of Customs lower in rank than a Commissioner of Customs may file an appeal to Commissioner (Appeals) within sixty days from the date of the communication of the order. The appeal shall be in Form C.A-1.

The Commissioner (appeals) shall dispose of the appeal in writing, stating the points for determination, the decision taken and the reasons for the decision within a period of six months where it is possible.

The aggrieved persons may note that, the Customs officers allow a period of three months from the date of decision for payment of dues adjudicated before resorting to coercive measures to recover such dues. The aggrieved person may file an application for stay before Commissioner (Appeals) to prevent the coercive measures for recovery of dues by the Department. The Commissioner (Appeals) must dispose of the stay application within one month of its filing.

The address of Commissioner (Appeals):

Commissioner (Appeals)
7th Floor, Kendriya Shulk Bhavan,
L.B.Stadium Road, Basheerbagh,
Hyderabad.

FORM NO. CA-I

[See Rule 3 of the Customs (Appeal) Rules, 1982]

Form of Appeal to the [Commissioner (Appeals)] under Section 128 of the Customs Act, 1962

1. No of 20

  1. Name and address of the appellant.
  2. Designation and address of the officer passing the decision or order appealed against and the date of the decision or order.
  3. Date of communication of the decision or order appealed against to the appellant.
  4. Address to which notices may be sent to the appellant.
  5. Whether duty or penalty or both is deposited. If not, whether any application for dispensing with such deposit has been made. (A copy of the Challan under which such deposit is made shall be furnished).
    1. Whether the appellant wishes to be heard in person.
  6. Reliefs claimed in appeal.

Statement of facts
Grounds of appeal

1.

2.

3.

Signature of authorized Signature of

representative, if any the
appellant.

I, …………………………………..the appellant , do hereby declare that what is stated above is true to the best of my information and belief.

Verified today, the ………day of ……..20…….

Place ………………………

Date …………………………

Signature of authorized Signature of

representative, if any the
appellant.

Notes:

1. The grounds of appeal and the form of verification shall be signed
by the appellant in accordance with the provisions of Rule 3 of the
Customs (Appeals) Rules, 1982.

2. The form of appeal, including the statement of facts and the grounds
of appeal shall be filed in duplicate and shall be accompanied by a
copy of the decision or order appealed against.

APPEAL TO APPELLATE TRIBUNAL:

Any person aggrieved by the order passed by Commissioner of Customs or Commissioner Appeals may appeal to the appellate tribunal called Customs, Excise, Service Tax Appellate Tribunal within three months in Form CA-3 from the date on which the order sought to be appealed against is communicated.

Address of Tribunal:

SOUTH ZONAL BENCH,
1st FLOOR, WTC BUILDING,
FKCCI COMPLEX, K.G.ROAD,
BANGALORE - 560 009.

FORM NO. C.A.-3

[See Rule 6(1) of the Customs (Appeal) Rules, 1982]

Form of Appeal to the Appellate Tribunal under Section 129A(1) of the Customs Act, 1962

In the Customs, Excise and Service Tax Appellate Tribunal

No of 20 Appeal
Applicant
Vs.
Respondent

(1) The designation and address of the authority passing the order appealed against.
(2) The number and date of the order appealed against.
(3) Date of communication of the order appealed against.

(4) State/Union territory and the [Commissionerate] in which the order/decision assessment / penalty/ fine was made.

(5) Designation and address of the adjudicating authority in cases where the order

appealed against is an order of the [Commissioner (Appeals)].

(6) Address to which notices may be sent to the appellant.
(7) Address to which notices may be sent to the respondent.
(8) Whether the decision or order appealed against involves any question having
a relation to the rate of duty or to the value of goods for purposes of
assessment; if not, the difference in duty involved or amount of fine or penalty
involved or value of goods involved, as the case may be.
(9) Whether duty or penalty is deposited; if not, whether any application for
dispensing with such deposit has been made.
(A copy of the Challan under which the deposit is made shall be furnished).

(10) Whether the appellant wishes to be heard in person.

(11) Reliefs claimed in appeal.

Statement of facts
Grounds of appeal

(i)

(ii)

(iii)

(iv)

Signature of authorized Signature of

representative, if any the
appellant.

Verification

I the appellant, do hereby declare that what is stated above is true to the best of my information and belief

Verified today the day of 20

Signature of the Signature of the
authorized appellant.

representative, if any.

NOTES: 1. The grounds of appeal and form of verification shall if the appeal is
made by any person, other than the [Commissioner of Customs], be
signed by the appellant in accordance with the provisions of Rule 3 of
the Customs (Appeals) Rules, 1982.
2. The form of appeal including the statement of facts and the grounds
of appeal shall be filed in quadruplicate and shall be accompanied by
an equal number of copies of the order appealed against (one of
which at least shall be a certified copy).
3. The form of appeal should be in English (or Hindi) and should set
forth, concisely and under distinct heads, the grounds of appeal
without any argument or narrative and such grounds should be
numbered consecutively.
4. The fee of Rs. 200/- required to be paid under the provisions of the
Act shall be paid through a cross bank draft drawn in favour of the
Assistant Registrar of the Bench of the Tribunal on a branch of any
Nationalised Bank located at the place where the Bench is situated
and the demand draft shall be attached to the form of appeal.

APPEAL TO CENTRAL GOVERNMENT

Any person aggrieved by the order passed by Commissioner of Customs or Commissioner (Appeals) relating to

a) Any goods imported or exported as baggage;

b) Any goods loaded in a conveyance for importation into India, but which are not unloaded at their place of destination in India, or so much of the quantity of such goods as has not been unloaded at any such destination if goods unloaded at such destination are short of the quantity required to be unloaded at that destination;

c) Payment of drawback as provided in Chapter X, and the rules made thereunder may file an application to the Central Government for revision of such order within three months from the date of communication to the applicant of the order against which the application is being made in Form CA-8 No further appeal lies against order passed by the Central Government.

[FORM NO. C.A.-8]

[See Rules 8A and 8B of the Customs (Appeal) Rules, 1982]

Form of Revision Application to the Central Government under Section 129DD of the Customs Act, 1962

1. Revision Application

No of

2. Name and address of the applicant
3. Designation and address of the authority passing
the order against which the revision application is
filed
4. The number and date of the order
5. Date of communication of the order
6. Designation and address of the authority against
which the order has been passed by the
[Commissioner (Appeals)]
7. Address to which notices/communications may be
sent to the Applicant

8. Whether duty or penalty, if any, has been
deposited ( a copy. Extra of the challan /account

current, as the case may be, under which the

deposit is made, shall be furnished

8a. Whether the applicant wishes to be heard in person

9. Reliefs claimed in application

(i)

(ii)

(iii) etc.

Statement of facts
Grounds of appeal

Signature of the authorized Signature of the

representative, if any. Applicant.

Verification

I the applicant, do hereby declare that what is stated above is true to the best of my information and belief

Verified today, the day of 19

Signature of the authorized Signature of the

representative, if any. Applicant,


NOTES: (I) The grounds of application and the form of verification shall be signed
by the applicant in accordance with the provisions of sub-rule (2) of
Rule 8A.
(2) The application, including the statement of facts and the grounds of
application, shall be filed in duplicate and shall be accompanied by an
equal number of copies of the order against which the application is
filed and also the decision/order of the authority against which
(Commissioner of Customs) (Appeals) passed the order.
(3) The form of application shall be in English (or Hindi) and shall set
forth, concisely and under distinct heads, the grounds of application
without any argument or narrative and such grounds should be
numbered consecutively.
(4) The fee of rupees two hundred required to be paid under the
provisions of the Act shall be paid under T.R. 6 challan and the
duplicate copy of the T.R. 6 challan shall be filed along with the
application for revision.
(5) Where the application is signed by the authorised representative of the
applicant, the document authorising the representative to sign and
appear on behalf of the applicant shall be appended to the application.l

[Authority: M F (D R) Notification No. 212- Cus., dated 10.9.1982 as amended by Notification No 15/85-Cus, dated 30- 1-1985.]

APPEAL TO HIGH COURT:

Any person aggrieved by the order (order not relating to the rate of duty of Customs or to the value of goods for purposes of assessment) passed by the Appellate Tribunal may file reference application to the Hon’ble High Court within one hundred and eighty days of the date the order is communicated to the applicant in Form CA—6 clearly stating the questioned of law which is sought to be referred to the High Court.

FORM NO. C.A.-6

[See Rule 8(1)]

Form of an Application to the High Court under

Section 130A of the Customs Act, 1962

In the High Court of Judicature at

In the matter of Appeal No. (Name of the appellant)

Application No. ___________________________of 20 _________

(To be filled in by the Office)

____________________________________________________Applicant

Vs.

____________________________________________________Respondent

(1) State/Union territory and the Commissionerate from which the application is filed:

(2) Number of the appeal which gives rise to the application:

(3) Address to which notice may be sent to the applicant:

(4) Address to which notice may be sent to the respondent:

(5) The appeal noted above was decided by the ________________ ___________ Bench of the Appellate Tribunal on:

(6) The notice of the order under Section 129B of the Customs Act, 1962 was served on the applicant on

(7) The facts which are admitted and/or found by the Appellate Tribunal and which are necessary for drawing up a statement of the case, are stated in

the enclosure for ready reference

(8) The following questions of law arise out of the order of the Appellate Tribunal

1.

2.

etc. 3.

(9) The applicant, therefore, requires under sub-section (1) of Section 130A of the Customs Act, 1962 that High Court directs the Appellate Tribunal to refer to the High Court the question(s) of law referred to in paragraph 8 above:

(10) The documents or copies thereof as specified below (the translation in English of the documents, where necessary) is annexed with the statement

of the case.

Signature of the authorized Signature of the
representative, if any. applicant.

Verification

I, ___________________________________________ the applicant, do hereby declare that what is stated above is true to the best of my information and belief.

Verified today, the ________________ day of ____________ ________________

Signature of the authorized Signature of the Applicant.

representative, if any.

Notes : (1) The application and the form of verification shall, if the application

is made by any person, other than the Commissioner of Customs, be

signed by the applicant in accordance with the provisions of Rule 3

of the Customs (Appeal) Rules, 1982.

(2) The application shall be filed in quadruplicate.

    1. The fee of Rs. 200/- required to be paid under the provisions of the Act shall be through a crossed bank draft drawn in favour of the Registrar of the High Court on a branch of any nationalised bank located at the place where the High Court is situated and the demand draft shall be attached to the form of application.]

APPEAL TO SUPREME COURT:

Any person aggrieved, by the order relating to the rate of duty of

Customs or to the value of goods for purposes of assessement passed by the Appellate

Tribunal or any judgment of the High Court may file an appeaI to the Hon’ble

Supreme Court within sixty days of the date the order is communicated to the

applicant.

SETTLEMENT COMMISSION:

During the pendency of a show cause notice the party may make an application for settlement before the settlement commission by making a true & full declaration of his duty liability. Settlement Commission is not forum for challenging the legality of assessement orders or matters relating to classification . The person may approach the settlement commission in cases where the additional duty liability accepted exceeds Rs.2 lakhs.

The advantage of making a declaration before the settlement commission is that the commission has the power to grant immunity from prosecution and immunity, full or partial, from infliction of fine, penalty and interest.

PROSECUTION:

In addition to departmental action, prosecution in a court law may be resorted to in serious cases of Customs contravention, outright smuggling or habitual offenders if mens rea is involved and value of goods is sufficiently high. Punishments are quite severe, going upto imprisonment for seven years and fine.

IMPROPER EXPORTS- PENAL PROVISIONS

Through the Finance Bill 2003, amendments have been made to Sections 113& 114 of the Customs Act, 1962 which widened the scope of goods liable for confiscation, if attempted to be improperly exported.

The words "dutiable or prohibited" occurring in clauses (c)(e)(f)(g) and (h) of Section 113 of the Customs Act have been omitted thereby widening the category of goods liable for confiscation, if attempted to be improperly exported.

The penalty leviable for improper exportation of goods has also been amended for certain category of goods. The same is now "three times the value of the goods as declared by the exporter or the value as determined under the Customs Act 1962 which ever is greater. Earlier the same was " the value of the goods or five thousand rupees which ever is greater".

 

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