Recovery of amounts without assessment and demand is in violation of the law and the Constitution of India.

ORDER

Rajesh Bindal, J. - C.M. No. 10370 of 2018 : Miscellaneous application is allowed and the accompanying replication along with Annexures P-6 to P-8 is taken on record.

C.W.P. No. 4247 of 2017

2. The grievance of the petitioner in the present writ petition is that at the time of import of goods, the duty leviable thereon was paid, however, the Directorate of Revenue Intelligence, New Delhi (for short 'the DRI') pressurised the petitioner to pay another sum of Rs. 40,00,000/- while detaining the goods in transit.

3. The submission is that the amount was paid to avoid delay in clearance and demurrage charges payable to the port authorities. The petitioner under the pressure of the DRI officials paid a sum of Rs. 40,00,000/- without there being any show cause notice or the order. It has been further submitted that when the amount was taken from the petitioner without there being any show cause notice or order passed confirming that demand, the same was in violation of Article 265 of the Constitution of India.

4. Learned Counsel for the petitioner referred to Division Bench judgments of this Court in Century Metal Recycling Pvt. Ltd. v. Union of India - 2009 (234) E.L.T. 234 (P & H) and Century Knitters (India) Ltd. v. Union of India - 2013 (293) E.L.T. 504 where refund of the amount recovered in this fashion was ordered. Delhi High Court's judgment in Digipro Import and Export Pvt. Ltd. v. Union of India and others -2017-TIOL-1076-HC-DEL-CX = 2017 (353) E.L.T. 3 (Del.) was also referred to wherein the matter was referred to CVC to enquire into the matter regarding harassment to the importers by the officials of the DRI.

5. Learned Counsel for the petitioner further submitted that even if demand is confirmed against the petitioner in terms of show cause notice dated 24-4-2017 issued to him, for filing appeal, the petitioner will have to deposit only 10% of the duty. Hence, recovery of money under coercion at this stage is without authority of law and the amount needs to be refunded.

6. On the other hand, Counsel for the respondents submitted that the amount was paid by the petitioner voluntarily, finding that he had violated the law while importing the goods by paying the duty on transaction value instead of the maximum retail price. The duty was leviable at the higher rate.

7. He further submitted that though show cause notice had already been issued to the petitioner on 24-4-2017, however, the proceedings are still pending.

8. Heard Learned Counsel for the parties and perused the paper book.

9. The fact that a sum of Rs. 40,00,000/- had been taken from the petitioner without there being any show cause notice or the demand at that time, is not in dispute. The only issue sought to be raised by Counsel for the respondents is that the amount was deposited by the petitioner voluntarily. That issue has already been gone into by this Court in Century Metal Recycling Pvt. Ltd. and Century Knitters (India) Ltd. cases (supra) wherein finding that certain amount was recovered from the exporter without any show cause notice or demand, it was ordered to be refunded.

10. In Century Metal Recycling Pvt. Ltd. (supra) it was held that unless there is assessment and demand, the amount deposited by the petitioners cannot be appropriated. It was observed as under :-

"13. As far as the amount deposited by the petitioners is concerned, case of the petitioners is that the same was deposited under coercion. Case of the respondents was that the same was deposited voluntarily. Whatever be the position, unless there is assessment and demand, the amount deposited by the petitioners cannot be appropriated. No justification has been shown for retaining the amount deposited, except saying that since it was voluntarily deposited. In view of this admitted position, the petitioners are entitled to be returned the amount paid."

11. In Century Knitters (India) Ltd. (supra) finding that certain amount was recovered by the revenue without any show cause notice o