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TMI Blog2025 (1) TMI 1329X X X X Extracts X X X X X X X X Extracts X X X X ..... P-29325-2022 (O&M), CWP-17888-2021 (O&M), CWP-18416-2021 (O&M), CWP-26913-2022 (O&M), CWP-17857-2021 (O&M), CWP-18276-2022 (O&M), CWP-626-2022 (O&M), CWP-16817-2021 (O&M), CWP-23088-2021 (O&M), CWP-11593-2023 (O&M), CWP-24394-2021 (O&M), CWP-14257-2022 (O&M), CWP-12379-2023 (O&M), CWP-12465-2023 (O&M), CWP-11853-2023 (O&M), CWP-12605-2023 (O&M), CWP-12645-2023 (O&M), CWP-12466-2023 (O&M), CWP-12661-2023 (O&M), CWP-8295-2023 (O&M), CWP-710-2022 (O&M), CWP-12915-2023 (O&M), CWP-12880-2023 (O&M), CWP-12841-2023 (O&M), CWP-12802-2023 (O&M), CWP-12663-2023 (O&M), CWP-11727-2023 (O&M), CWP-11680-2023 (O&M), CWP-17715-2021 (O&M), CWP-17320-2021 (O&M), CWP-17324-2021 (O&M), CWP-17731-2021 (O&M), CWP-23537-2016 (O&M), CWP-16204-2016 (O&M), CWP-14039-2023 (O&M), CWP-14037-2023 (O&M), CWP-13941-2023 (O&M), CWP-14229-2023 (O&M), CWP-13057-2023 (O&M), CWP-13056-2023 (O&M), CWP-14984-2023 (O&M), CWP-15112-2023 (O&M), CWP-13942-2023 (O&M), CWP-14214-2024 (O&M), CWP-26231-2016 (O&M), M/s Gautam Spinners, M/s Allround (India) Vegetable Processing Machine Pvt. Ltd. and another, Gautam International Through Its Proprietor, Tridev Overseas, Mahalaxmi Traders, M/s Dhown Woollen Mills, M/s PDG Wool Tra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... M/s Canon India Private Limited Vs. Commissioner of Customs [2021 SCC Online SC 200] Civil Appeal No.1827 of 2018 decided on 09.03.2021. 3. Relevant portion of the judgment of Hon'ble Supreme Court in the case of M/s Canon India Private Limited (supra), is reproduced as under:- "4. The main issue is whether after clearance of the cameras on the basis that they were exempted from levy of basic Customs duty under Notification No. 15/2012, the proceedings initiated by the Directorate of Revenue Intelligence for recovery of duty not paid under section 28 (4) of the Customs Act, 1962 are valid in law. * * * * * 9. The question that arises is whether the Directorate of Revenue Intelligence had authority in law to issue a show cause notice under Section 28 (4) of the Act for recovery of duties allegedly not levied or paid when the goods have been cleared for import by a Deputy Commissioner of Customs who decided that the goods are exempted. It is necessary that the answer must flow from the power conferred by the statute i.e. under Section 28 (4) of the Act. This Section empowers the recovery of duty not paid, part paid or erroneously refunded by reason of collusion or any wilful ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in Column (3) of the notification under the Customs Act on officers referred to in Column (2). The relevant part of the notification reads as follows:- "[To be published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (ii)] Government of India Ministry of Finance (Department of Revenue) Notification No. 40/2012-Customs (N.T.) New Delhi, dated the 2nd May, 2012 S.O. (E). - In exercise of the powers conferred by sub-section (34) of section 2 of the Customs Act, 1962 (52 of 1962), the Central Board of Excise and Customs, hereby assigns the officers and above the rank of officers mentioned in Column (2) of the Table below, the functions as the proper officers in relation to the various sections of the Customs Act, 1962, given in the corresponding entry in Column (3) of the said Table: - Sr.No. Designation of the officers Functions under Section of the Customs Act, 1962 (1) (2) (3) 1 Commissioner of Customs (i) Section 33 2. Additional Commissioner or Joint Commissioner of Customs (i) Sub-section (5) of Section 46; and (ii) Section 149 3. Deputy Commissioner or Assistant Commissioner of Customs and Central Excise (i) .... (ii).... (i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of Finance and Customs officers who, till 11.5.2002, were appointed by the Central Government. The notification which purports to entrust functions as proper officer under the Customs Act has been issued by the Central Board of Excise and Customs in exercise of non-existing power under Section 2 (34) of the Customs Act. The notification is obviously invalid having been issued by an authority which had no power to do so in purported exercise of powers under a section which does not confer any such power. 22. In the above context, it would be useful to refer to the decision of this Court in the case of Commissioner of Customs v. Sayed Ali and Another, (2011) 3 SCC 537 wherein the proper officer in respect of the jurisdictional area was considered. The consideration made is as hereunder:- "16. It was submitted that in the instant case, the import manifest and the bill of entry were filed before the Additional Collector of Customs (Imports), Mumbai; the bill of entry was duly assessed, and the benefit of the exemption was extended, subject to execution of a bond by the importer which was duly executed undertaking the obligation of export. The learned counsel argued that the functio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chargeable, requiring him to show cause why he should not pay the amount specified in the notice. It is evident that the notice under the said provision has to be issued by the 'proper officer'. 19. Section 2 (34) of the Act defines a 'proper officer', thus: '2. Definitions.- (34) 'proper officer', in relation to any functions to be performed under this Act, means the officer of customs who is assigned those functions by the Board or the Commissioner of Customs;' It is clear from a mere look at the provision that only such officers of customs who have been assigned specific functions would be 'proper officers' in terms of Section 2 (34) the Act. Specific entrustment of function by either the Board or the Commissioner of Customs is therefore, the governing test to determine whether an 'officer of customs' is the 'proper officer'. 20. From a conjoint reading of Sections 2 (34) and 28 of the Act, it is manifest that only such a Customs Officer who has been assigned the specific functions of assessment and reassessment of duty in the jurisdictional area where the import concerned has been affected, by either the Board or the Commissioner of Custo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... affecting the correctness of the same. b. The decision in Canon India (supra) failed to consider the statutory scheme of Sections 2 (34) and 5 of the Act, 1962 respectively. As a result, the decision erroneously recorded the finding that since DRI officers were not entrusted with the functions of a proper officer for the purposes of Section 28 in accordance with Section 6, they did not possess the jurisdiction to issue show cause notices for the recovery of duty under Section 28 of the Act, 1962. c. The reliance placed in Canon India (supra) on the decision in Sayed Ali (supra) is misplaced for two reasons - first, Sayed Ali (supra) dealt with the case of officers of customs (Preventive), who, on the date of the decision in Sayed Ali (supra) were not empowered to issue show cause notices under Section 28 of the Act, 1962 unlike the officers of DRI; and secondly, the decision in Sayed Ali (supra) took into consideration Section 17 of the Act, 1962 as it stood prior to its amendment by the Finance Act, 2011. However, the assessment orders, in respect of which the show cause notices under challenge in Canon India (supra) were issued, were passed under Section 17 of the Act, 1962 a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ices issued under Section 28 of the Act, 1962 cannot be said to be unconstitutional. It cannot be said that Section 97 fails to cure the defect pointed out in Canon India (supra) nor is it manifestly arbitrary, disproportionate and overbroad, for the reasons recorded in the foregoing parts of this judgment. We clarify that the findings in respect of the vires of the Finance Act, 2022 is confined only to the questions raised in the petition seeking review of the judgment in Canon India (supra). The challenge to the Finance Act, 2022 on grounds other than those dealt with herein, if any, are kept open. (vi) Subject to the observations made in this judgment, the officers of Directorate of Revenue Intelligence, Commissionerates of Customs (Preventive), Directorate General of Central Excise Intelligence and Commissionerates of Central Excise and other similarly situated officers are proper officers for the purposes of Section 28 and are competent to issue show cause notice thereunder. Therefore, any challenge made to the maintainability of such show cause notices issued by this particular class of officers, on the ground of want of jurisdiction for not being the proper officer, which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the connected Review Petition Nos. 401/2021, 402/2021 and 403/2021 insofar as the issue of jurisdiction of the proper officer to issue show cause notice under Section 28 is concerned. As discussed, the findings of this Court in Canon India (supra) in respect of the show cause notices having been issued beyond the limitation period remain undisturbed." 6. In view of the above we dispose of all the above referred to writ petitions in accordance with the decision of Hon'ble Supreme Court in Review Petition No 400/2021 titled Commissioner of Customs v. M/s Canon India Pvt. Ltd. and other connected review petitions [2024 SCC Online SC 3188]. 7. Since in all the above referred to writ petitions show cause notices issued under Section 28 of the Act 1962 have been challenged, the present writ petitions are disposed of by restoring such notices for adjudication by the proper officer under Section 28 of the Act, 1962. 8. Since in the impugned notices in the present writ petitions the period of 30 days was granted to file reply and further proceedings were stayed by this Court, therefore, all the petitioners are directed to file reply within a period of 30 days. The time limit of 30 days g ..... X X X X Extracts X X X X X X X X Extracts X X X X
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