Case Law Details
Relevant Extract of the Judgment
2. The assessee is engaged in the business of import and export of commodities, including edible oil, through a proprietory concern, i.e. M/s. Nova International. On 22.11.2006, a search was conducted by the Customs authorities in its premises; the assessee was arrested subsequently by the Directorate of Revenue Intelligence (DRI) on 05.12.2006 on the suspicion of evasion of payment of duties to the extent of more than Rs.3 crores.
3. The assessee had approached this Court; in the course of proceedings, the Customs authorities had contended that the duty element payable was in excess of Rs.3 crores and that bail could be granted only if a substantial amount out of that was deposited. The Court, therefore, made an order on 07.2007 in Bail Application 18/2007, directing the assessee to deposit total amount of Rs.70 lakhs which was to be appropriated by the Customs authorities. In addition, the assessee was also directed to furnish adequate security to the extent of Rs.2 crores. For the concerned year, i.e. AY 2007-08, the assessee contended that the amount had to be allowed under Section 43B of the 1961 Act. The Assessing Officer (AO) framed the assessment, disallowing the amount amongst others. He was of the opinion firstly that the amount was a penalty and consequently, even otherwise, in the absence of an adjudication order, no amount was payable.
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