Case Note & Summary
The petitioners, M/s. Indian Express Newspapers (Bombay) Pvt. Ltd. and its subsidiaries, imported printing machinery and photo composing equipment from M/s. Linotype Associates Pvt. Ltd., United Kingdom during 1981-1983. In 1987, the Customs department issued two show cause notices dated 19-20th October, 1987 and 11th December, 1987 alleging under-invoicing in the price of the imported machinery. The petitioners replied on 29th January, 1988 seeking time to file further reply and inspection of certain documents. They also mentioned that other newspapers like Times of India, Hindustan Times, Ananda Bazar Patrika, and Statesman had imported identical equipment from the same manufacturer. The respondents sent a further letter on 9th June, 1988. The petitioners challenged the show cause notices by way of a writ petition under Article 226 of the Constitution. The court considered whether the denial of inspection of documents relied upon by the department violated principles of natural justice. The court held that the show cause notices were issued without providing the petitioners an opportunity to inspect the documents, which is a fundamental requirement of natural justice. Consequently, the court quashed the show cause notices and directed the respondents to provide inspection of the documents before issuing fresh notices, if any.
Headnote
A) Customs Law - Show Cause Notice - Natural Justice - Denial of Inspection - The petitioners imported printing machinery and were issued show cause notices alleging under-invoicing. The petitioners sought inspection of documents relied upon by the department, which was denied. The court held that denial of inspection of documents relied upon in the show cause notice violates principles of natural justice and the notices are liable to be quashed. (Paras 1-3)
Issue of Consideration
Whether the show cause notices issued by the Customs department alleging under-invoicing in import of printing machinery are liable to be quashed on the ground that the petitioners were denied inspection of documents relied upon by the department, thereby violating principles of natural justice.
Final Decision
The court allowed the writ petition and quashed the show cause notices dated 19-20th October, 1987 and 11th December, 1987. The respondents were directed to provide inspection of the documents to the petitioners before issuing fresh show cause notices, if any.
Law Points
- Natural justice
- Right to inspection of documents
- Customs Act
- 1962
- Show cause notice
- Under-invoicing
