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2022 (4) TMI 436 - HC - CustomsValidity of SCN - Jurisdiction - Proper Officer or not - power of Commissioner, CGST and Central Excise, Kanpur, the Respondent No.4 to adjudicate the SCN - challenge is based on the premise that the Respondent No.4 is neither a proper officer nor is competent to pass any order under the Customs Act, 1962 - It is claimed that the Respondent No.4 was merely assigned the jurisdiction by the order of the Board dated 20.11.2012 and cannot, therefore, be an officer appointed under Section 4(1) of the Customs Act, 1962 - HELD THAT - A perusal of the notification dated 23.09.2011 issued by the Board would show that sub-Section (11) would operate notwithstanding anything contrary to the judgment, decree or order of any Court and all persons appointed as officers of the Customs under sub- Section (1) of Section 4 before the 6th Day of July, 2011 would be deemed to have always had the power of assessment under Section 17 and should be deemed and always should be considered as proper officers for the purpose of the said section. The question, however, as to whether by virtue of the notifications dated 07.07.1997, 07.03.2002 and 06.07.2011, the DRI would have the authority to act under Section 28 of the Customs Act and whether by virtue of the decision of the Hon'ble Supreme Court in the case of COMMISSIONER OF CUSTOMS VERSUS SAYED ALI 2011 (2) TMI 5 - SUPREME COURT this position would be altered. It is evident from the notification dated 07.07.1997 that all officers of the DRI are appointed as officers of the Customs under the notification dated 07.03.2002. The officers of the Directorate of Revenue Intelligence have been given jurisdiction over the whole of India. From the perusal of the notifications circulars and clarifications issued from time to time it is more than apparent that the Respondent No.2 had the jurisdiction to issue impugned show cause notice and the Respondent No.4 has the jurisdiction to adjudicate the same. The show cause notice under Section 28(1) could be issued by the Proper Officer . A Proper Officer is one, who is defined in Section 2(34) as the officer of Customs, either by the Board or by the Commissioner of Customs, who is assigned specific functions - the Respondent No.2 had the jurisdiction to issue impugned show cause notice. The petitioner is not entitled to any of the relief claimed in the writ petition. The writ petition is devoid of merit and is, accordingly, dismissed.
Issues Involved:
1. Jurisdiction of the Commissioner, CGST and Central Excise, Kanpur to adjudicate the show cause notice. 2. Competence of the Respondent No.2 to issue the show cause notice under the Customs Act, 1962. 3. Validity of the demands and penalties proposed under the show cause notice. 4. Sustainability of export and import duty demands on merits. 5. Applicability of Section 28AAA of the Customs Act. 6. Validity of benefits extended under DGFT authorizations. 7. Overall validity of the show cause notice. Issue-wise Analysis: 1. Jurisdiction of the Commissioner, CGST and Central Excise, Kanpur: The petitioner challenged the jurisdiction of the Commissioner, CGST and Central Excise, Kanpur (Respondent No.4) to adjudicate the show cause notice issued by the Commissioner of Customs (Respondent No.2). The petitioner argued that Respondent No.4 was not a "Proper Officer" under Section 2(34) or an officer appointed under Section 4(1) of the Customs Act, 1962. The court found that Respondent No.4 had been appointed as a Common Adjudicating Authority by the order of the Board dated 20.11.2012 and was thus competent to adjudicate the matter. Notifications and circulars from the Central Board of Excise and Customs (CBEC) supported this jurisdiction. 2. Competence of Respondent No.2 to Issue Show Cause Notice: The petitioner contended that Respondent No.2 was not competent to issue the show cause notice under Section 28 of the Customs Act. The court referred to various notifications and circulars, including those dated 07.07.1997, 07.03.2002, and 06.07.2011, which assigned functions of the "Proper Officer" to officers of the Directorate of Revenue Intelligence (DRI) for the purposes of Sections 17 and 28 of the Customs Act. The court concluded that Respondent No.2 was indeed competent to issue the show cause notice. 3. Validity of Demands and Penalties Proposed: The petitioner argued that the proposals for confiscation and imposition of penalties under Sections 114, 114A, 114AA, and 117 of the Customs Act were bad in law. The court found that the show cause notice was validly issued by the "Proper Officer" and that the Respondent No.4 had the jurisdiction to adjudicate the notice, thus upholding the validity of the proposed demands and penalties. 4. Sustainability of Export and Import Duty Demands: The petitioner contended that the demands for export duty and import duty were not sustainable on merits. The court did not find merit in these arguments and upheld the validity of the demands, as they were based on the proper issuance and adjudication of the show cause notice. 5. Applicability of Section 28AAA of the Customs Act: The court did not find any substance in the petitioner’s argument that Section 28AAA of the Customs Act could not be invoked. The court upheld the applicability of this section, which deals with the recovery of duties not levied or short-levied or erroneously refunded. 6. Validity of Benefits Extended under DGFT Authorizations: The petitioner argued that once the authorizations were issued by DGFT, the respondents could not question the benefits extended under these authorizations. The court did not find merit in this argument and upheld the validity of the show cause notice and the proposed demands and penalties. 7. Overall Validity of the Show Cause Notice: The petitioner argued that the show cause notice was otherwise bad in law. The court, however, found that the show cause notice was validly issued by a competent authority and upheld its validity. Conclusion: The court dismissed the writ petitions, finding that the show cause notice was validly issued and that the Respondent No.4 had the jurisdiction to adjudicate it. The court also rejected the petitioner’s request for a mandamus to direct Respondent No.4 to proceed with adjudication only after making available the requested documents and allowing cross-examination of witnesses. The court referenced a previous decision in Commissioner of Central Excise, Meerut-I vs. M/s Parmarth Iron Pvt. Ltd., Bijnor, which held that cross-examination of witnesses is not required before the adjudication proceedings commence. Final Order: The writ petitions were dismissed, and the court upheld the jurisdiction of Respondent No.4 to adjudicate the show cause notice and the validity of the demands and penalties proposed therein.
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