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2023 (12) TMI 966 - HC - CustomsContempt of court - Continuous, repeated, deliberate and wilful disobedience by the respondents ( DRI officials ) - violation of stay order granted by this Court against launching of any kind of civil as well criminal prosecution with respect to the subject matter - possession of unsold gold jewellery brought back from a Trade Exhibition in a foreign country weighing about 51172 grams - prohibited goods or not - HELD THAT -The manner in which the proceedings after proceedings are being foisted upon the petitioner and others besides the company in question, leave a lasting impression that there is a repeated, deliberate and contumacious attempt by the respondents officers to corner them from all angles, evidently to harass and prosecute the petitioner by whatever means in terms of purported action by intentionally over-reaching the directions of this Court. It goes without saying that the sanction accorded under Section 137 of the Act appears to be hit by the dictum propounded by the Supreme Court in the case of Canon India Pvt. Ltd. v. Commissioner of Customs 2021 (3) TMI 384 - SUPREME COURT in which it was held that the DRI officers are not customs officers, and therefore, not proper authority in law to initiate proceedings under the Act. In the process, evidently again, the respondents appear to have been instrumental in the initiation of proceedings against the petitioner and others connected with the company besides the company itself by other agencies including the DGFT as well as the Central Bureau of Investigation CBI . There was a categorical direction by this Court vide order dated 12.04.2021 that no coercive process shall be initiated pursuant to SCN and the main file in question bearing No. F.No. DRI/HQ-G/338/VI/ENG-2/INT-NIL/2019 dated 26.09.2019. The filing of the complaint before the Court of learned CMM for initiating action under different provisions of the Act is based on sanction accorded by respondent No.1 arising from the same main file and by deliberately suppressing the directions and orders passed in favour of the petitioner. Evidently, the SCN arising out of the main file is under a cloud and once the very foundation is on a sticky wicket, the purported prosecution is not fathomable. The purported prosecution entails a heavy burden on the entire justice delivery system at a huge cost, time and efforts on the part of the Court after Court. This Court finds the respondents guilty of committing patent breach of the directions passed by this Court and holds them guilty for committing a civil contempt under Section 2(b) read with Section 11 and 12 of the CC Act. Let notice be issued to the respondent officials for the next date of hearing i.e., 14.02.2024 to show cause as to why they should not be punished under Section 2 (b) read with Section 11 and 12 of the CC Act for being in gross violation of the directions of this Court dated 12.04.2021.
Issues Involved:
1. Alleged contempt of court by the respondents. 2. Legitimacy of the actions taken by the Directorate of Revenue Intelligence (DRI). 3. Compliance with procedural and legal norms by the DRI. 4. Validity of the prosecution initiated by the DRI. Summary: 1. Alleged Contempt of Court by the Respondents: The petitioner filed a contempt petition under Section 2(b) read with Sections 11 & 12 of the Contempt of Courts Act, 1971, alleging repeated and willful disobedience by the respondents to the court's orders dated 12.04.2021. The court had directed that no proceedings should be initiated pursuant to the Show Cause Notice (SCN) dated 26.09.2019. Despite this, the DRI initiated a criminal complaint, which the petitioner claims is a violation of the court's stay order. 2. Legitimacy of the Actions Taken by the DRI: The genesis of the dispute began on 24.04.2019 when the DRI intercepted a colleague of the petitioner at the Indira Gandhi International Airport for possessing unsold gold jewelry. The DRI conducted searches and seizures, arrested individuals involved, and alleged fraudulent re-importation of gold jewelry without customs duty payment. The petitioner alleged continuous harassment and abuse by the DRI officials, and the DRI changed its stance during the investigation. 3. Compliance with Procedural and Legal Norms by the DRI: The petitioner and other directors of IMNPL challenged the DRI's actions, alleging violations of legal procedures. The Supreme Court directed that no coercive action should be taken against the petitioners. Despite this, the Customs Authority did not release the seized gold articles, leading to further legal battles. The CESTAT and the Division Bench of the High Court found in favor of the petitioner, noting that the DRI's actions were not justified and that the petitioner had a prima facie case of rightful possession of the gold articles. 4. Validity of the Prosecution Initiated by the DRI: The court found that the DRI's criminal complaint was based on the same file as the SCN dated 26.09.2019, which was under a stay order. The DRI omitted to disclose favorable orders passed in favor of the petitioner, including those by the CESTAT and the Division Bench. The court noted that the DRI's actions appeared to be a deliberate attempt to harass the petitioner and others associated with IMNPL. The court held the respondents guilty of civil contempt for violating its directions and issued a show cause notice to the respondent officials. Conclusion: The court found that the DRI's actions were in gross violation of its orders and constituted civil contempt. The respondents were held guilty of deliberately and repeatedly attempting to harass the petitioner by initiating proceedings despite a stay order. The court emphasized the need for fairness and adherence to legal norms by the DRI in its actions.
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