Jurisdiction u/s 28AAA of Customs Act not invokable without Cancellation of License Procedings Initiated by DGFT: CESTAT

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has ruled on the applicability of Section 28AAA of the Customs Act, which deals with the recovery of duties from individuals who have obtained benefits through fraudulent means. The tribunal held that the jurisdiction under this section cannot be invoked against a license holder unless the license itself has been cancelled through proceedings initiated by the Directorate General of Foreign Trade (DGFT). The case involved a demand for duty from a person who had allegedly misused an export promotion license. However, the CESTAT found that since the DGFT, the licensing authority, had not initiated any proceedings to cancel the license, the customs department could not independently proceed to recover the duty under this specific section. This ruling establishes a clear procedural prerequisite for invoking Section 28AAA.