Kalyan Jyoti Sengupta, J.

This writ petition has been filed challenging the demand notice dated 07.02.2014 by which the respondent asked the petitioner to pay a sum of Rs.7,03,92,505/-towards central excise (Rs.1,28,26,974/-) and customs duties (Rs.5,75,65,331/-) along with interest under Section 28AB of the Customs Act, 1962 and Section 11AB of the Central Excise Act, 1944 in terms of the bond executed by them before the Assistant Commissioner of Customs and Central Excise, Hyderabad-A Division, in fulfillment of the conditions laid down for duty free import under the said notification within seven days of receipt of the demand notice.

Learned counsel for the petitioner stated that the impugned notice has been issued quantifying the amount of demand in violation of the principles of natural justice, as no show cause notice intending to afford, opportunity of being heard was issued before adjudication of the aforesaid amount allegedly due and payable.

In the counter affidavit it has been stated that in fact hearing was given after taking a decision and this fact is also admitted even in the notice. It is also contended that in a case of this nature issuance of show cause notice was not required under law.

Learned counsel for the petitioner highlighting the aforesaid fact drew our attention to Section 28 of the Customs Act, 1962 and submits that before adjudication as to leviability of any duty or any amount payable by the petitioner issuance of show cause notice is mandatory requirement of law. According to him, the post decisional hearing is not adherence to the requirement of the said Section.

Learned counsel for the respondent countering above contention says that if Section 28 of the Customs Act is read, it would appear that the dispute in this matter is not covered thereunder. Thus, it is legally permissible for the respondent to issue demand notice straight way. In any event, post decisional hearing has been given to the petitioner. Hence, there cannot be any grievance with regard to the alleged violation of principles of natural justice. He relied on the decision of the Supreme Court in the case of Commissioner of Customs, New Delhi vs. C.T. Scan Research Centre (P) Ltd. 2003 (155) E.L.T. 3 (S.C.) on the point that issuance of show cause notice is not a mandatory requirement for raising demand.

We have considered the rival contentions and we have examined the issue involved in this matter, which is reproduced hereunder:

“Whether issuance of show cause notice in a case of this nature is mandatory or not?”

Before we address to the issue, we examine Section 28(1)(a) of the Customs Act that requires issuance of show cause notice. Accordingly, the said section is set out hereunder:

“28. Recovery of duties not levied or short-levied or erroneously – (1) Where any duty has not been levied or has been short-levied or erroneously refunded, or any interest payable has not been paid, part-paid or erroneously refunded, for any reason other than the reasons of collusion or any willful mis-statement or suppression of facts, -

(a) the proper officer shall, within one year from the relevant date, serve notice on the person chargeable with the duty or interest which has not been so levied or which has been short-levied or short-paid or to whom the refund has erroneously been made, requiring him to show cause why he should not pay the amount specified in the notice.”

From the facts of this case it appears that the petitioner was otherwise liable to pay the duty, but for the exemption notification. It follows logically that duty is leviable in absence of exemption. To our mind overruling the contention of the learned counsel for the respondent the aforesaid section covers the dispute involved herein as ultimately liability to pay duty may rest on petitioner if its contention is rejected. Naturally, show cause notice is a must before adjudication of the quantity of the duty sought to be levied followed by demand. Clause (a) of s