- (1.) The question of law which arises in these two appeals is identical which concerns the interpretation that is to be accorded to the provisions of Kar Vivad Samadhan Scheme (for short, the 'Scheme') that was introduced under Chapter IV of the Finance (No.2) Act of 1998 (hereinafter referred to as the '1998 Act') and is contained in Sections 86 to 98 of the said Act. In particular, it is Section 95(ii)(b) of the 1998 Act that becomes the focus of the issue and the meaning that is to be assigned to the said clause would be the determinative of the outcome of the dispute.
(2.) It has arisen under the following circumstances (facts are taken from Civil Appeal No. 7570 of 2004 for the sake of convenience): The appellants carry on the business, inter alia, of importing old ships for the purpose of ship breaking and disposing of the scrap. In 1993, they imported a vessel called M.V. Pablo Metz and for clearance of these goods, filed the Bill of Entry under Section 46 of the Customs Act, 1962. Although the appellants contended that the said import was exempted from levy of 'additional customs duty' under an exemption Notification dated February 28, 1993, the Customs authorities, after hearing the appellants, felt it otherwise. An endorsement on the Bill of Entry was made for payment of additional customs duty of 52,20,000 in addition to the basic customs duty. The said endorsement was made under Section 47 read with Section 153 of the Customs Act and required the appellants to make payment of the amount assessed within 7 days, failing which interest was chargeable.
(3.) This levy was challenged by the appellants by means of a writ petition before the High Court of Calcutta, which was disposed of by the High Court with a direction to the appellants to submit a bank guarantee for 50% of the disputed amount and a personal bond for the balance 50%.;