2008 (10) TMI 412 - AT - Customs

Show cause notice - Jurisdiction - Territorial jurisdiction - Held that - In Notification No. 30/97-Cus. (N.T.), the Central Government, under Section 4(1) of the Customs Act, appointed certain officers as Commissioners , Deputy Commissioners and Assistant Commissioners of Customs to exercise powers and discharge duties within their respective jurisdictions . In respect of those officers who were appointed as Commissioners of Customs , it was further specified that their jurisdiction would extend to the whole of India . In Notification No. 83/2004-Cus. (N.T.) also, the Government specified territorial jurisdiction for the officers appointed as Chief Commissioners , Commissioners , Additional Commissioners and Deputy/Asst. Commissioners of Customs. All these Notifications were issued under Section 4(1) of the Act. Notification No. 31/2000-Cus. (N.T.) as amended by Notification No. 69/2000-Cus. (N.T.), which is central to the present dispute, was also issued by the Central Government under the same provision of law, but this Notification did not specify area of jurisdiction for the officers of Customs appointed thereunder. The Board did not invoke Section 5(1) of the Act to specify such jurisdiction either. The SCN and the corrigendum thereto were issued without jurisdiction and the same are quashed - appeal allowed - decided in favor of appellant.

Summary

Issues Involved:
1. Jurisdiction of the Additional Director-General of Central Excise Intelligence (ADGCEI) to issue the show-cause notice (SCN).
2. Validity of the follow-up proceedings by the Commissioner of Customs (Seaport-Imports), Chennai.

Detailed Analysis:

1. Jurisdiction of the ADGCEI to Issue the SCN:

The appellants contested the jurisdiction of the ADGCEI to issue the SCN, arguing that the Central Board of Excise and Customs (CBEC) had not specified the territorial jurisdiction for the ADGCEI to function as an officer of Customs. They pointed out that Notification No. 31/2000-Cus. (N.T.) did not specify any territorial limits for the ADGCEI, and thus, the SCN issued by the ADGCEI was without jurisdiction.

The respondent argued that in the absence of specified territorial limits, the ADGCEI had "All India jurisdiction" as the Customs Act extended to the whole of India. The respondent relied on the Tribunal's Larger Bench decision in Konia Trading Co. v. Commissioner of Customs, Jaipur, and a letter from the CBEC, which supported the notion of All India jurisdiction for officers of the DGCEI.

The Tribunal noted that, according to Sections 4 and 5 of the Customs Act, the Central Government could appoint officers of Customs, but it was the CBEC's responsibility to specify their territorial jurisdiction. Since the CBEC had not specified any territorial limits for the ADGCEI, the Tribunal concluded that the ADGCEI did not have the jurisdiction to issue the SCN.

2. Validity of Follow-up Proceedings by the Commissioner of Customs (Seaport-Imports), Chennai:

Given that the SCN was issued without jurisdiction, the Tribunal held that the follow-up proceedings by the Commissioner of Customs (Seaport-Imports), Chennai, were also invalid. The Tribunal quashed the SCN and the follow-up proceedings, declaring them ab initio bad in law.

Conclusion:

The Tribunal ruled that the SCN and the subsequent proceedings were issued without jurisdiction due to the lack of specified territorial limits for the ADGCEI. Consequently, both appeals were allowed on the jurisdictional issue, and the SCN and follow-up proceedings were quashed.