2017 (7) TMI 1147 - HC - Customs

Principles of Natural Justice - cross-examination of the noticees not afforded - penalty u/s 112 of the CA 1962 - Held that - The issues raised in the writ petition are such, an opportunity should be afforded to the respondents to file affidavit - it would be appropriate to direct that, no steps shall be taken for realisation of the penalties from the petitioners without obtaining the leave of the Court till August 31, 2017or until further order, whichever is earlier - petition disposed off.

Summary

Issues:
1. Right of cross-examination denied to petitioner
2. Quantum of penalty imposed under Section 112 of Customs Act, 1962

Analysis:
1. The petitioner challenges the order passed by the Commissioner of Customs, alleging a breach of natural justice due to the denial of the right of cross-examination of certain noticees. The learned advocate for the petitioner contends that the impugned order violated the principles of natural justice by not allowing cross-examination of noticee nos. 1, 2, and 8 despite a request being made. This denial raises concerns regarding procedural fairness and adherence to due process requirements.

2. Furthermore, the petitioner contests the quantum of penalty imposed, arguing that it is not in accordance with Section 112 of the Customs Act, 1962. Citing precedents such as the judgment in Gopal Saha vs. Union of India & Anr. and the order in Barik Biswas vs. Union of India & Ors., the petitioner asserts that the Customs Authorities exceeded their jurisdiction in imposing the penalty under Section 112(i) of the Act. The petitioner relies on the fact that the previous judgments have questioned the applicability of Section 112(i) in similar cases, indicating a potential legal inconsistency in the imposition of penalties.

Court's Directions:
The Court directs the respondent Authorities to file an affidavit-in-opposition within three weeks and allows a week for the petitioner to file a reply thereafter. The writ petition will be considered ready for immediate hearing upon completion of the affidavit filing period, with liberty granted to the parties to request an early hearing. In light of the precedents cited, particularly Gopal Saha and Barik Biswas, the Court orders a stay on any steps for penalty realization from the petitioners without prior leave of the Court until August 31, 2017, or until further orders are issued, whichever comes earlier. This interim measure aims to prevent any undue enforcement actions pending the resolution of the legal issues raised in the petition.