2022 (5) TMI 720 - HC - Customs

Validity of SCN - Smuggling - seizure of gold bar, silver ingots and fine silver and cash - notice under Section 110 (2) of the Customs Act, 1962 for extending the time for investigation was quashed and subsequent notices/summons issued to the petitioner therein have been held to be without any authority of law - HELD THAT - Taking into consideration the submission made by learned counsel for the petitioner based on order dated 02.03.2022 passed by the High Court in WPC No.5388 of 2021 whereby the notice under Section 110 (2) of the Act of 1962 was held to be without any authority of law, the notice was quashed, it is directed that respondents shall not proceed any further pursuant to notice dated 23.04.2022 (Annexure P-1) issued under Section 124 of the Act of 1962, till the next date of hearing. List this case after four weeks.

Summary

Issues:
Challenge to seizure proceedings and subsequent notices under Customs Act, 1962.
Application for grant of interim relief.
Validity of order in Writ Petition No. 5388 of 2021.
Amendment to the Customs Act, 1962.
Interim relief sought by the petitioner.

Analysis:
The petitioner challenged the seizure proceedings initiated by the Directorate of Revenue Intelligence (DRI) following the arrest of two individuals and the subsequent search of the petitioner's house, resulting in the seizure of gold, silver, and cash. The petitioner contended that the notices issued under Section 110 (2) of the Customs Act, 1962 were without legal authority. The High Court, in an order dated 02.03.2022, quashed the notice under Section 110 (2) and held subsequent notices to be invalid. The petitioner argued that as per the Act, if proceedings are not concluded within the prescribed period, the goods seized must be returned, which had not been done. The respondent challenged this order before the Division Bench in Writ Appeal No.211 of 2022, claiming the proceedings were not final. The respondent also cited an amendment to the Act with retrospective effect, omitting the mention of the Proper Officer, as grounds to deny interim relief.

Considering the circumstances and the previous High Court order quashing the notice under Section 110 (2) of the Act, the Court directed the respondents not to proceed further based on the notice issued under Section 124 of the Act until the next hearing. The Court scheduled the case for a hearing after four weeks. This decision aimed to maintain the status quo and prevent further action based on the challenged notice. The Court acknowledged the petitioner's argument regarding the lack of authority in the notices issued under the Act and took that into consideration in granting the interim relief. The Court's decision reflected a balance between the petitioner's concerns and the respondent's contentions regarding the pending appeal and the recent amendment to the Act. The directive provided a temporary halt to the proceedings under Section 124 of the Act until the matter could be further examined, ensuring fairness and due process in the legal proceedings.