Hero Electric moves High Court to plea against DRI show cause

30 Aug 2022 , 07:56 AM

Hero Electric Vehicles filed a petition with the Punjab and Haryana High Court asking the court to overturn a show cause notice that the Directorate of Revenue Intelligence (DRI) had issued accusing the business of evading customs taxes.

In its 2020 notice, the DRI alleged that the business had misrepresented imported electric scooter kits as components in order to avoid paying duty. It had stated that the company caused the government to lose Rs311 crores because the pieces in the kits, when assembled, created an entire electric scooter, which attract a greater rate of duty than components.

The maker of electric scooters argued before the HC that several sections of the Finance Act, 2022 were arbitrary, unreasonable, and in violation of the Constitution’s articles on equality before the law and freedom to practice any profession or carry on any occupation, trade, or business.

The electric scooter maker also claimed that the defects identified by the Hon’ble Supreme Court in the Canon India (supra) judgment had not yet been corrected, rendering the validating Act void.

Additionally, the rules that are being contested give various officers concurrent jurisdiction over the same matter, which would lead to confusion, anarchy, the intimidation of assessors, and contradictory and contradicting rulings, according to the plea obtained by ET.

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