2016 (12) TMI 13 - HC - Customs

Validity of an order on a showcause notice against the Petitioners passed by Joint Director General of Foreign Trade - Held that - the Respondents admit that the show cause notice issued on 9th July, 2010 could not be adjudicated till 2015 for some reason or other. The Petitioners have already submitted their reply to the show cause notice. Once it was decided to take it up for adjudication only in the year 2015, then, interests of justice demanded that the Petitioners should have been heard before an adverse order. The opportunity of personal hearing, even if the earlier date had been postponed, should have been granted in the peculiar facts and circumstances. We are of the opinion that the Petitioners were granted an opportunity on 5th June, 2015 to remain present. However, that was not availed of on the ground that the advocate was unavailable. Though, the Petitioners claim that a notice dated 11th June, 2015 scheduling the hearing on 16th June, 2015 was never received, we do not wish to enter into that controversy. As we have noted that the show cause notice remained pending for nearly five years, if one more opportunity had been extended and granted, nothing was lost. In such circumstances, without entering into the merits, we quash and set aside the impugned order. It is quashed and set aside only on the ground that the Petitioners were not granted an opportunity of personal hearing. Now, the Petitioners have agreed to appear before the authority on 1st December, 2016. Let, the Petitioners so appear and if on that date they remain present, the Joint Director shall allow them to rely on such material as is permissible in law. If the Petitioners fail to appear on that date, the authority can proceed on the footing that right of personal hearing stands forfeited. Thereafter it can pass an order in accordance with law.

Summary

Issues:
1. Whether the order passed by the Joint Director General of Foreign Trade against the Petitioners is valid.
2. Whether the Petitioners were denied the opportunity of personal hearing.
3. Whether the impugned order should be set aside.

Analysis:
1. The High Court noted that the order passed by the Joint Director General of Foreign Trade against the Petitioners was challenged directly in a Writ Petition. The Court highlighted that there was an alternate remedy of Appeal under Section 15 of the Foreign Trade (Development and Regulation) Act, 1992. The Petitioners argued that they were not given a chance to appear in person and show cause despite a detailed reply to the show cause notice. The Respondents contended that sufficient opportunities were provided, and the Petitioners failed to avail them. The Court found that the show cause notice remained pending for nearly five years without adjudication, and justice demanded that the Petitioners should have been heard before any adverse order was passed.

2. The Court observed that the Petitioners were granted an opportunity to appear on a specific date, but they could not do so as their advocate was unavailable. The Petitioners claimed that they did not receive a subsequent notice scheduling another hearing date. The Court, without delving into this controversy, emphasized that granting one more opportunity for a personal hearing would not have caused any harm. Therefore, the Court quashed and set aside the impugned order solely on the ground that the Petitioners were not given a fair chance of personal hearing.

3. The Court clarified that the order was set aside only due to the lack of a personal hearing for the Petitioners. The Petitioners agreed to appear before the authority on a specified date, and if they failed to do so, the authority could proceed accordingly. The Court directed that no further notice needed to be issued for the hearing date agreed upon by the Petitioners. Additionally, the Court stated that it did not express any opinion on the merits of the case, focusing solely on the procedural aspect of denying the Petitioners a personal hearing.

In conclusion, the High Court's judgment primarily revolved around the procedural irregularity of not granting the Petitioners a personal hearing before passing the impugned order. The Court emphasized the importance of providing a fair opportunity to be heard, ultimately leading to the order being quashed and set aside on that specific ground.