2018 (7) TMI 627 - HC - Customs

Competency of officers of Directorate of Revenue Intelligence to adjudicate the SCN which were kept in the call book - Validity of Circular No.276/104/2016-CX.8A dated 3/01/2017 issued by the Central Board of Excise & Customs - SCN issued by DRI - Held that - For every issue, some or the other case would be pending in High Court or the Hon ble Supreme Court. The same cannot cause fetter in exercise of quasi judicial or judicial functions of the authorities or lower courts. If merely for this reason the adjudication is kept in call book, there would be grave injustice and the same would be not in public interest. The matters can be kept in call book, if there is specific direction for the same issued in that case by the Superior Courts. The apprehension of the petitioner that the adjudicating authority would pass a final order without following the said mandatory, statutory and legal requirements and the petitioner would then be forced to hardship of payment of pre-deposit which is pre-requisite for availing appellate remedies, is also unfounded - Had the petitioner prima facie shown any material for such apprehension, we would have issued notice to ensure compliance of statutory requirements or if the final order is passed by the Adjudicating Authority without following the said mandatory, statutory and legal requirement, the petitioner would be entitled for invoking writ jurisdiction under Article 226 of the Constitution of India, irrespective of alternative remedy of appeal provided under the Customs Act, 1962. Petition dismissed - decided against petitioner.

Summary

Issues:
Challenge to Circular No.276/104/2016-CX.8A dated 3/01/2017 by the petitioner under Article 226 of the Constitution of India.

Analysis:
The petitioner contested the Circular issued by the Central Board of Excise & Customs, which directed the adjudication of show cause notices that were kept in call book to proceed in accordance with the law. The petitioner argued that the earlier Circulars of 2016, which were withdrawn, were based on the competency of officers of Directorate of Revenue Intelligence, as per the judgment of Delhi High Court in a specific case. The petitioner emphasized that even if a judgment is stayed, it operates only with respect to the parties involved and not universally. Thus, the petitioner claimed that the judgment of the Delhi High Court remains in force for all others and, therefore, the adjudication should be kept in call book. The petitioner highlighted that several similar cases across India have been put on hold due to the impugned Circular.

The Circular in question was issued based on legal advice from the Solicitor General of India. The court emphasized that the stay on the Delhi High Court judgment did not prevent the authorities from exercising their jurisdiction and proceeding with adjudication. The court noted that challenges to Circulars by the Department are not permissible, as Circulars are binding on the authorities. The court cited previous judgments to support the binding nature of Circulars and the need for consistency in actions based on the Circulars in force at the relevant time.

Regarding the apprehension of the petitioner that the Adjudicating Authority might not comply with statutory requirements under the Customs Act, the court found no basis for such concerns. The court highlighted various precedents and judgments that emphasize the importance of following statutory requirements in adjudicating proceedings. The court dismissed the petitioner's unfounded apprehensions and reiterated the necessity for compliance with statutory provisions.

The court rejected the petitioner's claims and concluded that the writ petition lacked merit, leading to its dismissal. The court clarified that if the petitioner had provided substantial evidence to support their apprehensions, the court would have intervened to ensure compliance with statutory requirements. The court emphasized that the petitioner could still avail appellate remedies provided under the Customs Act, 1962, even if the final order passed did not adhere to statutory requirements.