{"id":2931,"date":"2025-03-03T13:19:47","date_gmt":"2025-03-03T07:49:47","guid":{"rendered":"https:\/\/centaxblogs.taxmann.com\/?p=2931"},"modified":"2025-03-03T13:19:47","modified_gmt":"2025-03-03T07:49:47","slug":"customs-directed-to-refrain-from-repeatedly-resorting-to-coercive-measures-during-investigation","status":"publish","type":"post","link":"https:\/\/www.centaxonline.com\/blog\/customs-directed-to-refrain-from-repeatedly-resorting-to-coercive-measures-during-investigation","title":{"rendered":"Customs Directed to Refrain From Repeatedly Resorting to Coercive Measures During Investigation"},"content":{"rendered":"<pre><strong>Case Details:<\/strong> <a href=\"https:\/\/www.centaxonline.com\/latest-news-updates\/customs\/101010000000389405\/customs-was-directed-to-refrain-from-repeatedly-resorting-to-coercive-measures-during-investigation\">Advantek Fuel Systems Pvt. Ltd. Versus Commissioner of Customs (Preventive) (2025) 27 Centax 326 (Del.)<\/a><\/pre>\n<h2><em>Judiciary and Counsel Details<\/em><\/h2>\n<ul>\n<li><strong>Prathiba M. Singh<\/strong> &amp; <strong>Dharmesh Sharma<\/strong>, JJ.<\/li>\n<li><strong>Ms Anjali Jha Manish, S\/Shri Priyadarshi Manish, Shreyansh Kushwaha, Jatin Kumar Gaur, Paras Aneja<\/strong> &amp; <strong>Aman Ahluwalia<\/strong>, Advs., for the Petitioner.<\/li>\n<li><strong>S\/Shri Aditya Singla<\/strong>, SSC, <strong>Rahul Jain, Ritwik Saha<\/strong> &amp; <strong>Umang Mishra<\/strong>, Advs., for the Respondent.<\/li>\n<\/ul>\n<h2><em>Facts of the Case<\/em><\/h2>\n<p>The assessee, engaged in the development of CNG\/LPG conversion systems, imported specific CNG kit components in 2017 and availed of the exemption under Notification No. 50\/2017-Customs, dated 30-06-2017. Subsequently, this exemption was rescinded on 31st March 2022 through Notification No. 2\/2022-Customs dated 01-02-2022. Initially, the Customs Department did not object to the exemption claim. However, an investigation was later initiated to reassess the validity of the exemption. The petitioner was informed that the investigation had been closed, but a summons was issued a year later, contradicting the prior closure notice and indicating the continuation of the inquiry. During the investigation, the petitioner and its directors were alleged to be non-cooperative, prompting the Department to provisionally attach the petitioner\u2019s bank accounts. The petitioner challenged this action by filing a writ petition before the Delhi High Court.<\/p>\n<h2><em>High Court Held<\/em><\/h2>\n<p>The Hon\u2019ble Delhi High Court held that the Customs Department must assess whether sufficient grounds exist to justify the withdrawal of the exemption under Notification No. 50\/2017-Customs dated 30th June 2017. If such grounds are found, a show cause notice must be issued within three months. The Court further ruled that coercive measures, including repeated summonses and the freezing of bank accounts, must not be undertaken without proceeding with adjudication. Recognizing the adverse impact on business continuity, the Court directed the immediate unfreezing of the petitioner\u2019s bank accounts while allowing an ad hoc deposit of Rs. 3 crores under protest.<\/p>\n<h2><em>List of Notifications Cited<\/em><\/h2>\n<ul>\n<li><a href=\"https:\/\/www.centaxonline.com\/search?searchData=Notification%20No.%2050%2F2017-Cus.&amp;itemType=AP\">Notification No. 50\/2017-Cus.<\/a>, dated 30-6-2017 [Paras 3, 9]<\/li>\n<li><a href=\"https:\/\/www.centaxonline.com\/search?searchData=Notification%20No.%202%2F2022-Cus.&amp;itemType=AP\">Notification No. 2\/2022-Cus.<\/a>, dated 1-2-2022 [Para 3]<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Case Details: Advantek Fuel Systems Pvt. Ltd. Versus Commissioner of Customs (Preventive)&hellip;<\/p>\n","protected":false},"author":5,"featured_media":2943,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[38,177,47],"tags":[],"class_list":["post-2931","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-customs","category-customs-news","category-custom-case-chronicles"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.9 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Customs Directed to Refrain From Repeatedly Resorting to Coercive Measures During Investigation<\/title>\n<meta name=\"description\" content=\"The Delhi High Court ruled that coercive measures, including freezing bank accounts, cannot be taken without adjudication and directed the immediate unfreezing of accounts with an ad hoc deposit.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, 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