2019 (10) TMI 428 - HC - Customs

Jurisdiction - power to issue SCN - Section 28 of the Customs Act, 1962 - the issue is pending for consideration before the Supreme Court in FORECH INDIA PVT. LTD. VERSUS COMMISSIONER OF CUSTOMS INLAND, CONTAINER DEPOT, TUGHLAKABAD, NEW DELHI 2017 (12) TMI 984 - DELHI HIGH COURT where it was held that the Tribunal would independently apply its mind on the question of jurisdiction and decide the issue - HELD THAT - This Court is of the opinion that an identical approach is necessary in this case. Accordingly, following the order in FORECH INDIA PVT. LTD. VERSUS COMMISSIONER OF CUSTOMS INLAND, CONTAINER DEPOT, TUGHLAKABAD, NEW DELHI 2017 (12) TMI 984 - DELHI HIGH COURT , this appeal is allowed and the CESTAT would independently apply its mind to the question of jurisdiction and also decide the appeal on merits, including the aspect of imposition of penalty if any. Appeal allowed in part.

Summary

Issues:
1. Delay in filing appeal condonation.
2. Competence and jurisdiction under amended Section 28 of the Customs Act, 1962.
3. Remand of issues for reconsideration by the concerned Commissioner.
4. Dichotomy of judicial opinion regarding jurisdiction of Directorate of Revenue Intelligence (DRI).
5. Previous judgments influencing the decision-making process.
6. Applicability of Supreme Court stay on specific judgments.
7. Imposition of penalty and rights of DRI in issuing show cause notices.

Analysis:
1. The judgment first addresses the issue of delay in filing the appeal, where the court allows the condonation of delay based on the reasons stated in the application, disposing of the relevant application.

2. The primary issue revolves around the competence and jurisdiction under the amended Section 28 of the Customs Act, 1962. The court notes a dichotomy of judicial opinion on this matter, with conflicting views regarding the jurisdiction of the Directorate of Revenue Intelligence (DRI). The court refers to previous judgments, including one by the Supreme Court, influencing the current decision-making process.

3. Considering the remand of issues for reconsideration by the concerned Commissioner, the court emphasizes the need for an independent assessment of jurisdiction by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT). The court directs CESTAT to decide the appeal on its merits, including aspects such as the imposition of penalties and the rights of DRI in issuing show cause notices.

4. The court highlights the importance of the Tribunal independently applying its mind to the question of jurisdiction, ensuring that the decision-making process is not influenced by specific judgments, such as the one in Mangli Impex Limited v. Union of India. The court allows the appeal in part, with specific directions for the Tribunal to proceed after issuing notice to the respondent.