Delhi HC says no Separate Proceedings Against Scrip Users Required under Section 28AAA

The Delhi High Court clarified that the absence of proceedings against subsequent users of duty credit scrips is not, by itself, a bar to action against exporters under Section 28AAA of the Customs Act. Where duty credit instruments are alleged to have been obtained through collusion, wilful misstatement or suppression of facts, the authority must examine whether the statutory ingredients of Section 28AAA are established against the concerned noticees. The Court set aside CESTAT's contrary approach, which treated the absence of action against subsequent users as determinative.