2017 (6) TMI 1057 - AT - Customs

Jurisdiction of Directorate of Revenue Intelligence (DRI) - power to issue SCN - Held that - sub-section 11 was inserted under section 28 of the Customs (Amendment and Validation) Act, 2011 dated 16.09.2011, assigning the functions of proper officers to various DRI officers with retrospective effect - Later on, i.e. for the period subsequent to the amendment, the matter i.e. the DRI officers having the proper jurisdiction to issue the SCN or not had come up before the Hon ble Delhi High Court in the case of Mangali Impex vs. Union of India 2016 (5) TMI 225 - DELHI HIGH COURT , and the High Court inter alia, held that even the new inserted section 28(11) does not empower either the officers of DRI or the DGCEI to issue the SCN for the period prior to 8.4.11. Matter remanded to the original adjudicating authority to first decide the issue of jurisdiction after the availability of Hon ble Supreme Court decision in the case of Mangli Impex and then on merits of the case but by providing an opportunity to the assessee of being heard - appeal allowed by way of remand.

Summary

Issues Involved:
Jurisdiction of DRI officers to issue show cause notice under the Customs Act.

Detailed Analysis:

Jurisdiction Issue:
The appellant challenged the show cause notice issued by the Directorate of Revenue Intelligence (DRI), citing the Hon'ble High Court of Delhi's ruling in a previous case. The appellant contended that DRI officers were not proper officers under the Customs Act, based on a Supreme Court decision. However, subsequent amendments and notifications empowered DRI officers to issue such notices. The High Court of Delhi ruled in favor of the assessee, while conflicting decisions arose from other High Courts. The matter was stayed by the Supreme Court, pending a final decision. Another case before the High Court of Delhi granted liberty to review the challenge based on the outcome of the Supreme Court appeals. Considering these factors, the Tribunal set aside the impugned order, remanding the matter to the original authority for jurisdiction determination post the Supreme Court decision, and then for a merit-based decision with a hearing opportunity for the assessee, maintaining status quo until the final decision.

In conclusion, the Tribunal allowed the appeals by the assessee for remand, following the principles laid down by the High Court of Delhi in a similar case and considering the overall circumstances and legal developments surrounding the jurisdiction issue.