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Supreme Court sets aside DRI show cause notice against Canon India

It is significant to note that while the decision to clear the goods for import because they were exempted from customs duties under Notification No.15/2012, was taken by Deputy Commissioner, Appraisal Group, Delhi Air Cargo, the show cause notice was issued by the Additional Director General, Directorate of Revenue Intelligence

Supreme Court

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New Delhi: The Supreme Court has set aside show-cause notices issued by the Directorate of Revenue Intelligence (DRI) in a matter against Canon India.

"We, therefore, hold that the entire proceeding in the present case initiated by the Additional Director General of the DRI by issuing show-cause notices in all the matters before us are invalid without any authority of law and liable to be set-aside and the ensuing demands are also set aside," the SC order by a bench of Chief Justice of India S.A. Bobde, A.S. Bopanna and V. Ramasubramanian said in a case Canon India as the appellant versus Commissioner of Customs.

The batch of statutory appeals arises from a common final order of the Central Excise and Service Tax Appellate Tribunal (CESTAT) dated 19th December 2017 (impugned order).

Through the impugned order an exemption of basic customs duty accorded to the Digital Still Image Video 1 Cameras (DSIC) imported by the Nikon India Pvt. Ltd, Canon India Pvt. Ltd., Sony India Pvt. Ltd. and Samsung India Electronics Pvt. Ltd (hereinafter referred to as 'appellants' or 'importers'), in terms of exemption Notification No. 20/2005 dated 01.03.2005 (as amended by Notification No. 15/2012 dated 17.03.2012) came to be denied and the consequential confiscation of goods, demand of interest and imposition of penalty as provided for under various sections of the Customs Act, 1962, was upheld by the CESTAT.

"Since the appeals involve common questions, these are being decided together and for sake of convenience we shall be referring to the events which took place in the case of Nikon", the order said.

It said the main issue is whether after clearance of the cameras on the basis that they were exempted from levy of basic Customs duty under Notification No.15/2012, the proceedings initiated by the Directorate of Revenue Intelligence for recovery of duty not paid under Section 28(4) of the Customs Act, 1962 are valid in law. The consignment of cameras arrived at Delhi on 15.3.2012.

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