2018 (4) TMI 239 - HC - Customs

Maintainability of petition - alternative remedy of appeal - validity of second SCN for the same order in original - Held that - There cannot be two parallel proceedings assailing the correctness of the very same order-in-original, dated 23/9/2016. One before the Tribunal, by way of appeal, and another, by way of writ petitions, which may give rise to conflicting decisions - also, there is alternative remedy. Appeal dismissed being not maintainable.

Summary

Issues Involved:
1. Legality of the second show cause notice.
2. Availability and adequacy of alternative remedies.
3. Jurisdiction of the High Court under Article 226 of the Constitution.

Issue-wise Detailed Analysis:

1. Legality of the Second Show Cause Notice:
The appellants challenged the issuance of the second show cause notice dated 23/1/2016, arguing it was ultra vires and against the provisions of the Customs Act, 1962. They sought a writ of declaration to declare the notice and consequential proceedings illegal, invalid, and non est in the eye of law. The appellants relied on the decision of the High Court of Hyderabad in Syed Irfan Mohammed Vs. Union of India to support their claim that a second show cause notice is impermissible.

2. Availability and Adequacy of Alternative Remedies:
The Court observed that the appellants had an effective and alternative remedy by way of an appeal before the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT). The writ petitions were dismissed on the grounds that the existence of an alternative remedy precluded the invocation of the High Court's special jurisdiction under Article 226 of the Constitution. The Court cited several precedents, including Union of India v. T.R. Verma, C.A. Ibrahim v. ITO, and Karnataka Chemical Industries v. Union of India, to emphasize that when a statutory remedy is available, it must be exhausted before resorting to writ jurisdiction.

3. Jurisdiction of the High Court under Article 226 of the Constitution:
The Court reiterated the principle that the High Court should not entertain a writ petition when an adequate and efficacious alternative remedy is available. This principle is a rule of self-imposed limitation and is well-established in tax and fiscal matters. The Court referenced multiple Supreme Court decisions, including Titaghur Paper Mills Co. Ltd. v. State of Orissa and United Bank of India Vs. Satyawati Tondon, which held that the High Court should exercise restraint and require litigants to pursue statutory remedies before invoking Article 226. The Court also noted exceptions to this rule, such as violations of fundamental rights or principles of natural justice, but found none applicable in this case.

Conclusion:
The Court concluded that there cannot be two parallel proceedings challenging the same order-in-original. It emphasized the need to avoid conflicting decisions and upheld the principle that statutory remedies must be exhausted first. The appellants were directed to approach CESTAT, Madras, for any further relief. The writ appeals were dismissed, and the appellants were granted liberty to seek a joint hearing before the Tribunal.