2019 (6) TMI 883 - HC - Customs

Attachments of Bank Accounts - Respondent were of the view that there was an evasion of customs duty and the bills of entry were kept pending - SCN not issued in respect of two consignments or in respect of any other issue relating to the Petitioner under the Customs Act - HELD THAT - Issue decided in the case of RAJURAM PUROHIT VERSUS THE UNION OF INDIA THROUGH DIRECTORATE OF REVENUE INTELLIGENCE AND ANOTHER 2018 (3) TMI 1444 - BOMBAY HIGH COURT where it was held that We do not see how we can freeze a bank account or not allow the petitioner to deal with it until the show cause notice is issued and final orders are passed thereon. In the present case we are only quashing the impugned notice dated 1st August, 2018 as modified by letter dated 8th August, 2018. We are not disturbing any other seizure made under Section 110 of the Customs Act, 1962 to protect the interest of the Revenue. Petition disposed off.

Summary

Issues Involved:
Challenge to attachment of bank accounts by Directorate of Revenue Intelligence without issuance of show cause notice.

Analysis:
The petition sought to vacate the attachment of bank accounts by the Directorate of Revenue Intelligence without the issuance of a show cause notice, contending that it hindered business operations and livelihood. The petitioner highlighted previous court decisions to support the argument that such attachments were against established legal principles. The court adjourned the matter to allow the respondents to represent themselves adequately.

The respondent restricted the attachment to a specific amount following an affidavit, citing statutory provisions. The petitioner's counsel argued that the continued freezing of the account without a show cause notice was unjust and beyond jurisdiction, referencing past court decisions for support. The respondent justified the attachment based on suspicions of smuggled goods proceeds in the account, opposing any interference.

The court noted that the issue was settled in previous cases where drastic actions were taken without proper legal procedures. It emphasized the necessity of issuing show cause notices, providing opportunities for replies and personal hearings before any adjudication. The court quashed the impugned communication based on these principles, ensuring that revenue interests could be protected through lawful means.

In alignment with previous judgments, the court decided to quash the impugned notice while allowing other seizures under the Customs Act to continue for revenue protection. The final decision was to set aside the notice dated August 1, 2018, as modified by subsequent communications, concluding the petition on those terms.