Judgment:
1. The appellant has imported certain dot Matrix Printers manufactured by Nakajina All Company and supplied by Kovac Corporation. Bill of Entry No. 665 dt. 11.11.1991 filed by them was assessed to a value of Rs. 29,80,432/- and duty paid on 3.1.1992 and goods cleared.
2. The importers submit they are regular importers of the subject goods and have cleared many such other consignments. They had directed Kovac Corporation to make random checks and inspections on certain consignments for the subject consignment a fee of one Million Japanese yen was required to be paid to Kovac Corporation for which an application was made to the Reserve Bank of India on 23rd July 1992 and permission to remit this amount was received on 13.8.1992.
3. On 21.12.1992, a Show Cause Notice dt. 11.12.1992 was received by them seeking to recover Customs Duty of Rs. 4,05,941/- under Section 28 of the Customs Act it also sought to levy a penalty and was answerable to the Assistant Collector of Customs, ICD Bangalore. This duty was on the one Million Japanese yen remitted to Kovac Corporation for testing charges and was to be added to the values declared and assessed in Bill of Entry 665 dt. 11.11.1991.
A reply was sent to this notice on 29.12.1992. No intimation of any hearing, as requested was received. However, another Show Cause Notice was received on 7.12.1994 made answerable to the Commissioner. The appellant submits that this Show Cause Notice was also issued by the Assistant Collector as it would appear from the heading. They sent a reply dt. 16.11.1994 to the Assistant Collector pointing out this piquent situation. They however, received a reply to be present before the Collector on 4.1.1995 for a personal hearing. The appellants complied and questioned the proceedings and submitted on merits and filed written submission. On 14.2.1995, the appellants received a letter dt. 3.2.1995 from the Assistant Collector withdrawing his notice dt. 11.12.1992. The Collector issued the order now impugned before us on 14.3.1995, passing an order partly confirming the demand and also levied a penalty of Rs. 2 lakhs.
4. On 19.2.2001, we have heard both sides, the Advocate promised to submit a copy of the Contract within a week but no copy was received even after 15 days are over. The SDR was directed to produce the office copy of the Show Cause Notice dt. 7.12.1994, which has been complied by a letter on 26.2.2001 enclosing a photo copy of a show cause notice No.S40/6/92/CD dt. 4-10-1994 which bears the initials of the then Collector in the office copy and is in two pages. We have considered the matter and find- (a) The photo copy of the Show Cause Notice dt. 7.10.1994, in the paper book is only in one page, does not bear the signature of the Collector but only the words SD/- and is attested under an illegible signature/initial of one P.B. Naik with a rubber stamp marked below reading as 'Assistant Collector of Customs, Inland Container Depot, Bangalore-560046.' This creates a reasonable doubt as expressed by the appellants that the Collector has not applied his mind and such notices are not a valid notice issued as held in the case of Punalur Paper Mills Ltd. . This notice, invoking the extended period as issued has to be therefore set aside, as we cannot uphold a notice issued without application of mind.
(b) When the Assistant Collector has issued a notice No. 23/92 dt.
11/14.12.1992 and the same is being contested and personal hearing was requested by the appellants vide his letter dt. 29.12.1992. The same cannot be withdrawn by a letter dt. 3.2.1995 by on K. Siddhana, signing as Assistant Collector of Customs Inland Container Depot, Bangal are, for the reason that another notice dt. 7.10.1994 has been issued on the same issue. This letter indicated withdrawal of notice No. 23/92 at. 11/14.11.1992; it is not known whether there is a typographical error on casualness in the withdrawal, or something more sinister, since the subject mentions the date of notice to be 11/14.12.1992 and the body mentions it as 11/14.11.1992. The entire affair has been taken and conducted in a very casual manner. This surely cannot call for imposition of grave penalties on the importer.
(c) On merits we find that the appellants have no case. Since they have failed to produce the contract; we are not able to appreciate the fine differentiation of the Supreme Court Decision in the Case of Bombay Dyeing & Manufacturing Co. Ltd. being made by the learned Advocate. This decision would be applicable since all cost incurred for the goods outside India on behalf of the importer's requirements for the imported goods will be required to be added to the value.
(d) Even though the Revenue has a good case on merits, we cannot uphold -such slipshod handling of the invocation of the extended period found by us to be without application of mind. The benefit of the same has to go to appellants, as we are not convinced about the suppression of facts and the existence of any reason for invocation of the larger period by the Collector.
5. In view of our findings, the order is set aside and appeal allowed.
(Pronounced in the open Court on 15.3.2001).