2017 (11) TMI 1412 - HC - Customs

Whether the CESTAT was justified and correct in law in passing an order of remand to the CUSAA Nos. 57/2017 & 58/2017 Page 3 of 4 original adjudicating authority to first decide the issue of jurisdiction, after decision of the Supreme Court in Civil Appeal preferred against the decision of Delhi High Court in Mangli Impex Limited v. Union of India 2016 (5) TMI 225 - DELHI HIGH COURT ? Held that - The Tribunal will decide the appeals on merits, including the question of jurisdiction of the officers of DRI to issue the show cause notice, without being influenced by the decision of the Delhi High Court in the case of Mangli Impex Limited which has been stayed by the Supreme Court - the substantial question of law is answered in favor of the appellants - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Maintainability of writ petitions before the High Court based on grounds of appeal raised before the Tribunal.
2. Jurisdiction of the Tribunal to decide the issue of jurisdiction of officers of the Directorate of Revenue Intelligence.
3. Justifiability of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) in passing an order of remand to the original adjudicating authority after the decision of the Supreme Court.

Analysis:
1. The issue of maintainability of writ petitions before the High Court was raised based on the grounds of appeal not relating to the rate of duty. The appellants argued that the Tribunal should examine the matter on merits, including the contention that an officer of the Directorate of Revenue Intelligence lacked the authority to issue the show cause notice. The respondents did not object to setting aside the remand order and requested the Tribunal to decide the issue on merits, disregarding the decision of the Delhi High Court in a specific case.

2. The Tribunal had remanded the matter back to the original adjudicating authority to decide the jurisdiction issue after a Supreme Court decision. The appellants and respondents highlighted that the original order was issued after a significant delay of more than 6 years. They argued that remanding the case at this stage would cause prejudice and harassment. It was emphasized that the Tribunal should independently consider the contentions of the parties, including the imposition of penalties and the authority of the Directorate of Revenue Intelligence to issue show cause notices.

3. The High Court answered the substantial question of law in favor of the appellants and set aside the Tribunal's order. It directed the Tribunal to decide the appeals on merits, including the jurisdiction issue, without being influenced by the decision of the Delhi High Court in the specific case, which was stayed by the Supreme Court. The High Court clarified that it did not express any opinion on the merits of the appeals or the procedural aspects to be adopted by the Tribunal.

In conclusion, the High Court disposed of the appeals with no order as to costs, emphasizing the need for the Tribunal to independently assess the jurisdiction issue and decide the appeals on merits without being swayed by the stayed decision of the Delhi High Court.