The Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ), Hyderabad Bench held that the Adjudicating Authority lacks jurisdiction when no show cause notice ( SCN ) is issued under Section 124 of the Customs Act, 1962.
The appellant has applied to the Central Licensing Authority i.e., CDSCO, to grant import license in respect of Dialysis Machine ( Fresenius Medical 5008 Cordiax Dialysis Machine ). The Deputy Commissioner ordered for confiscation of the impugned goods valued at Rs.5,62,961/- under section 111(d) of Customs Act read with Hazardous and Other Waste Management Rules, 2016 and ordered for re-export of the goods to the supplier at the cost of the importer within 30 days from the date of receipt of the order. The Adjudicating Authority has also imposed penalty of Rs.20,000/- on the appellant/importer under section 112(a) of the Customs Act, 1962.
The counsel for the appellant submitted that the Adjudicating Authority has passed the adjudication order without issuing any SCN as required under section 124 of the Customs Act. Thus, impugned order is vitiated for lack of jurisdiction with the Adjudicating Authority for passing the order. It is sine qua non for the Adjudicating Authority to serve SCN, which gives him the jurisdiction to pass the adjudication order. It is evident on the face of record that no SCN was issued and only a notice was issued stating that – “Further, during examination, it is found that the items imported were used only.
It was pointed out that as per Hazardous Waste Management Rules 2016, used medical items listed in Schedule II are prohibited as per import policy. Hence you are requested to submit all the import documents immediately to this office for further proceedings.” Thus, evidently, no SCN proposing confiscation containing list of allegations was issued. Thus, the adjudication order is both bad in law and also against the principles of natural justice.
A Single Bench of Anil Choudhary, Judicial Member observed that “I further find that the impugned order is vitiated for lack of jurisdiction, which is a primary requirement and I hold that the Adjudicating Authority lacks jurisdiction to pass the order, as admittedly no SCN was served in accordance with section 124 of the Customs Act.”
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