The main legal point established in the judgment is that the Settlement Commission lacks jurisdiction to entertain applications related to misdeclaration of goods and that the provisions of the Customs Act should be strictly construed in such cases.

D. V. SHYLENDRA KUMAR, J.

( 1 ) WRIT Petition by the Commissioner of Customs, Bangalore, a statutory functionary in terms of section 3 of the Customs Act, 1962 [for short, the Act], as one class of officer of the Customs department, questioning the legality of the order dated 26-9-2001, a copy of which is produced at Annexure-A to the writ petition, passed by the Customs and Central Excise Settlement commission [for short, the Settlement Commission], Additional Bench, Chennai in proceedings settlement Application No. SA (C) 10/2001.

( 2 ) THE order passed by the Settlement Commission is sought to be quashed on the premise that the commission lacks jurisdiction to settle the case at the instance of the respondent to whom the adjudicating authority under the Act had issued a showcause notice in terms of Section 124 of the Act, calling upon the respondent to show cause as to why correct duty should not be assessed and realized from the respondent in respect of certain goods which the respondent had cleared without a bill entry but by claiming the goods as his personal baggage on 3-12-1999, when the respondent was returning from Singapore.

( 3 ) THE show cause notice had, inter alia, indicated that the declaration by the respondent that the personal baggage contained only toys was a mis-declaration; that it contained large quantities of mobile phones, mobile phones in CKD condition, computer ROMS, notebooks ROMS and such other notified items notified for the purpose of Section 123 of the Act which were being brought for sale on commercial lines and not for mere personal use of the respondent. The show cause notice had indicated the duty liability and also proposed to levy penalty etc.

( 4 ) IT is on receipt of such show cause notice dated 23-5-2000, the respondent had filed an application before the Settlement Commission under the provisions of Section 127b of the Act, praying for the case to be settled in terms of Section 127c of the Act.

( 5 ) THE Settlement Commission had called for a report from the Commissioner of Customs and took up the matter for settlement, the result of which is the impugned order. For the purpose of invoking the jurisdiction of the Settlement Commission, the respondent as applicant had indicated the goods which were brought as part of his personal baggage to be electronic items and had also indicated the value of the said goods, but had disputed the duty liability on the premise that the respondent should claim the benefit of exemption notification No. 136/1990 dated 20-3-1990 as amended by Notification No. 28/1998 dated 2-6-1998, on the premise that a person who imports such articles with licence will be entitled for such benefit of duty concession and had claimed as such.

( 6 ) THE Commissioner of Customs in his report to the Settlement Commission had, inter alia, indicated that the Commissioner of Customs, Bangalore had also accorded sanction for prosecuting the respondent in view of repeated violations of the provisions of the Act and that the respondent had been detained for a year or so under the provisions of COFEPOSA and it was not a fit case for settlement etc.

( 7 ) THE Settlement Commission examined such aspects and as it found that there was no representation on behalf of the Commissioner before the Settlement Commission, proceeded to examine the matter after hearing the learned Counsel for the applicant-respondent and on the basis of the material placed by the applicant before it. The Settlement Commission was also of the view that the applicant had made a full and true disclosure of both the value and the duty liability and as the applicant had accepted the proposition in the show cause notice and had only claimed that the benefit of Notification No. 136/1990 as amended by Notification No. 28/1998 and on such premises proceeded to determine the duty liability at Rs. 11,25,040/- as against the duty liability that had been proposed in the show cause notice at Rs. 18,38,300/ -.

( 8 ) T

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