2014 (1) TMI 170 - HC - Customs

Confiscation of goods - Violation of various provisions of law - De-bonding of DG Set value - Held that - An investigation has to be done by the authorities in accordance with law and if there is any defect in the enquiry so conducted, the person aggrieved can in any way challenge the same in a manner known to law. But when the investigation is on, calling upon the investigating agency to state the nature of investigation, the documents they want and to furnish the details and the intelligence gathered and also making observations on the nature that investigation conducted, is unwarranted in the facts of this case. It is suffice to say that it would be not necessary for us to go into the details about the illegality of the order passed by the learned single Judge from time to time. In the interest of both the parties, the investigation is to be completed at the earliest. No one shall interfere with the said investigation including this Court - investigation agency shall conduct the investigation in accordance with law without anyway getting influenced by the observations made in the impugned order or in the order passed earlier to that - Decided in favour of Revenue.

Summary

Issues:
1. Refund of unauthorisedly collected amount during investigation
2. De-bonding of DG Set
3. Termination of investigation
4. Quashing of letter and destruction of marble scrap
5. De-bonding of capital goods
6. Setting aside order passed by Settlement Commission

Analysis:
1. The respondent, a 100% export-oriented unit engaged in the manufacture of polished granites and marble slabs, had incriminating documents seized during a search of their premises. The respondent had only honored 19 out of 46 summons issued and deposited Rs.2 crores during the investigation. The respondent filed W.P.No.14827/2013 seeking a mandamus for the refund of the collected amount during the investigation. The single Judge clubbed multiple cases related to the issue and passed interim orders, leading to the challenge by the Intelligence Bureau through appeals.

2. W.P.No.14828/2013 was filed for de-bonding of a DG Set, and other petitions were filed for various related issues like termination of investigation, quashing a letter, destruction of marble scrap, de-bonding of capital goods, and setting aside an order by the Settlement Commission. The single Judge's orders indicated a detailed examination of the investigation nature, documents required, and observations against the authorities for procedural lapses. The Judge also raised concerns about the investigation's legality and limitations.

3. The High Court, after hearing both parties, emphasized the completion of pleadings and the need to proceed with hearing the writ petitions on merits. The Court found the detailed scrutiny of the investigation by the single Judge unwarranted and emphasized the completion of the investigation in accordance with the law without interference. The High Court set aside the single Judge's order and directed the authorities to continue the investigation expeditiously without being influenced by previous observations. The rights of the respondent were to be determined through a fair hearing of the writ petitions.

4. The High Court allowed the appeals, set aside the impugned order, and instructed the expeditious hearing and decision of the clubbed writ petitions in accordance with the law. The authorities were directed to conclude the investigation promptly without being swayed by any observations made in the appeals. The focus was on ensuring a fair and lawful investigation process while protecting the rights of the parties involved.