2019 (7) TMI 1430 - HC - Customs

Jurisdiction - power of Additional Director General, Ahmedabad to issue SCN - whether the show-cause notice was issued by the competent authority or not? - availability of alternative remedy - HELD THAT - Undisputedly, in the present case, two show-cause notices were issued by the Additional Director General, DGCEI Ahmedabad. One of the show-cause noticee was answerable to the Commissioner (Customs), Exports, Uran District Raigarh and the other was answerable to the Additional Commissioner, Customs Central Excise, Indore. The respondent No.4 has issued a show-cause notice dated 30.01.2004 to the petitioner to show cause the respondent No.3 as to why the duty drawback amounting to ₹ 6,40,92,368/- wrongly availed by the petitioner should not be disallowed under Rule 16 of the Customs, Central Excise and Service Tax Drawback Rule, 1995 and recovery of Central Excise Duties amounting to ₹ 2,25,930/- under Rule 12 of the CENVAT Credit Rules and recovery of ₹ 5,72,174/- under the proviso to Section 11-A along with penalty and interest be not recovered - Another show-cause notice was issued to the petitioner to show-cause to respondent No.2 as to why DBK amount to ₹ 26,08,366/- should not be allowed under Rule 16 of the Customs, Central Excise and Service Tax Drawback Rules, 1995 along with penalty and interest. This Court is not dealing with the merits of the case, as the petitioner does have an alternative remedy - In the present case, there is a remedy of appeal and the petitioner on some pretext or the other is delaying the matter. He could very well raised all grounds by filing an appeal. Recovery, which is running in crores, is pending against the petitioner. The show-cause notice can never said to be a vague show-cause notice or a show-cause notice issued by an authority not competent to issue the showcause notice. In the present case, the petitioner was served with the proper show-cause notice, he was granted an opportunity of hearing and detailed and exhaustive order has been passed by the competent authority - it is certainly true that alternative remedy is not an absolute bar, but the fact remains that the petitioner is having equal efficacious alternative remedy. The order has been passed after following the principles of natural justice and fair play, the show-cause notices were issued by the competent authority, and therefore, the question of interference by this Court, in light of alternative remedy, does not arise. This Court is of the considered opinion that the petitioner is having an alternative remedy and as the department has not been able to recover the due amount since 2004, the question of interference by this Court does not arise - petition dismissed.

Summary

Issues Involved:
1. Jurisdiction of the authority issuing the show-cause notice.
2. Competence of the officer who passed the impugned order.
3. Availability and adequacy of alternative remedies.
4. Compliance with principles of natural justice and fair play.

Detailed Analysis:

Jurisdiction of the Authority Issuing the Show-Cause Notice:
The petitioner challenged the jurisdiction of the Additional Director General, Directorate General Intelligence, Ahmedabad, to issue the show-cause notice. The petitioner argued that the officer did not have the authority under the Customs Act, 1962, to issue such a notice. The respondents contended that the show-cause notices were issued by the competent authority, as the Additional Director General holds the powers of the Commissioner of Customs, as per the notifications issued under the Customs Act and the Central Excise Act. The court upheld the respondents' contention, confirming that the show-cause notices were issued by a competent authority.

Competence of the Officer Who Passed the Impugned Order:
The petitioner argued that the officer who passed the impugned order was transferred to Mysore and relieved on 21.05.2010, thus questioning the validity of the order passed on 20.05.2010. The court found that the officer was still the Additional Commissioner at Indore until 21.05.2010 and hence was competent to pass the order. The court dismissed the petitioner's claim of malafide intent merely because the order was not in their favor.

Availability and Adequacy of Alternative Remedies:
The court emphasized that the order passed by the respondents is an appealable order. It cited previous judgments, including W.P. No.4136/2016 and W.P. No.267/2017, where similar circumstances led to the dismissal of writ petitions in favor of pursuing alternative remedies. The court reiterated that a writ petition should not be entertained when an effective alternative remedy is available unless the order is without jurisdiction or suffers from illegality or perversity. The court found that the petitioner had an adequate alternative remedy and was attempting to delay the adjudication process.

Compliance with Principles of Natural Justice and Fair Play:
The petitioner claimed that the principles of natural justice and fair play were not followed. However, the court noted that the petitioner was served with a proper show-cause notice and was granted an opportunity of hearing. The court found that the detailed and exhaustive order was passed by the competent authority after observing the principles of natural justice and fair play. The court dismissed the petitioner's reliance on various judgments, including those related to judicial review and procedural impropriety, as they were not applicable to the present case.

Conclusion:
The court dismissed the writ petition, emphasizing the availability of an alternative remedy and the competence of the authorities involved. The court upheld the validity of the show-cause notices and the impugned order, confirming that they were issued and passed by competent authorities. The court found no violation of natural justice and fair play, and thus, no grounds for interference.