The Rajasthan High Court has held that the DRI Officer has no competent authority to issue show cause notice and adjudicate the same as “proper officer” under Customs Act.
The petitioner, M/s Fairdeal Shipping Agency Pvt Ltd. is that he is a Customs House Agent and the co-petitioners were importers engaged in the import of Glass Chatons at Customs ports at Jaipur. One investigation was conducted by Additional Director, DRI (Zonal) Unit Ahmedabad, in connected matter by DRI, Jaipur who after the investigation demanded custom duty under Section 28 of the Act of 1962 and proposed confiscation of the seized goods and imposition of penalty under Section 124, 112, 114A of the Act, 1962. The show cause notice was issued as back as dated 06.08.2014 and in connected matter in 2019.
The petitioner contended that the said show cause notice was adjudicated vide order dated 15.03.2021 in violation of principles of natural justice without grant of right to cross-examination, without consideration of Apex Court judgment in Commissioner of Customs Vs. Sayed Ali & Anr. reported in (2011) 3 SCC 537 and Cannon India Private Ltd (supra), wherein it has been held that DRI Officers are not proper officers and show cause notice issued by them are ab initio void, illegal and lacks jurisdiction and non- consideration of the above judgments is in violation of Article 141 of the Constitution of India. Similar controversy was raised in the bunch of writ petition referred above that the show cause notice issued under Section 124 of the Act of 1962, by the DRI Officers is without jurisdiction.
Per contra, counsel Mr. Kinshuk Jain representing the respondents has submitted that the present writ petitions are not maintainable as order in original is passed and appeal has been filed by the petitioners. As per him, it is a settled position of law that where an alternative remedy is available, the writ petition is not maintainable. As per his submission, subsequent to the judgment of Apex Court in the case of M/s Canon India Private Ltd (supra), a number of writ petitions were filed before various High Courts for quashing of show cause notices issued by DRI Officers in which directions have been given to first approach Adjudicating Authority to decide the issue of jurisdiction. He further submitted that judgment of Canon India Private Ltd (supra), is distinguishable as the present matter pertains to Section 124 of the Act of 1962 qua the confiscation of goods whereas the Apex Court judgment pertains to provisions of Section 28 of the Act of 1962 for recovery of demand.
The division bench of Chief Justice Akil Kureshi and Justice Sameer Jain has held that the entire proceedings initiated by officers of DRI in as much as by issuance of show cause notice under Section 28/124 of the Customs Act lacks jurisdiction and are without any authority of law because the present show cause notice is not issued by custom officer but by DRI officer who has not been assigned specific function/power under Section 6 to issue show cause notice U/S 28 of the Act of 1962. DRI officer is not Competent Authority to issue show cause notice and adjudicate the same as “proper officer”. The Act, the notification relied upon, does not define and bring the DRI officers within four corners of “proper officers” having functions and powers to act under Section 28 of the Act of 1962.
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