2021 (5) TMI 327 - GUJARAT HIGH COURT

Validity of detention and seizure of goods - allegation is that scraps in different forms seized from the premises were found to be imported without payment of appropriate customs duty - classification of goods - discarded and non-serviceable semi-broken/broken motor under CTH 7204 49 00 under the Other Ferrous Waste and scrap or not - jurisdiction to entertain this petition in wake of the availability of the alternative efficacious remedy - HELD THAT:- The law on the point if is regarded, it is quite clear that jurisdiction under Article 226 of the Constitution of India is not to be resorted to ordinarily when the alternative and efficacious remedy is available, unless of course the very issuance of notice is not sustainable under the law - The writ jurisdiction under Article 226 is not to be entertained against the show cause notice when statute provides for mechanism which is efficacious, alternative and productive as the very purpose of issuance of show cause notice to afford opportunity of hearing to the party concerned and on showing of the cause to the statutory authority, a final decision is to be rendered, it is pre-matured to interfere with the show cause notice by the court. Although, the Court has wide powers under Article 226 of the Constitution and it can also exercise in certain circumstances at the stage of issuance of show cause notice (when the show cause notice is totally non est etc.) Accordingly such powers are not to be exercised by the Court and this approach of self restraint and self limitation is adopted by the High Court always and that being a well settled position of law, no further dilation is needed.

The writ jurisdiction under Article 226 is not to be entertained against the show cause notice when statute provides for mechanism which is efficacious, alternative and productive as the very purpose of issuance of show cause notice to afford opportunity of hearing to the party concerned and on showing of the cause to the statutory authority, a final decision is to be rendered, it is pre-matured to interfere with the show cause notice by the court. Although, the Court has wide powers under Article 226 of the Constitution and it can also exercise in certain circumstances at the stage of issuance of show cause notice (when the show cause notice is totally non est etc.) Accordingly such powers are not to be exercised by the Court and this approach of self restraint and self limitation is adopted by the High Court always and that being a well settled position of law, no further dilation is needed.

Here is the case where the petitioner has filed Electronic Bill of Entry in the EDI system, where it can claim a particular exemption or a particular classification. On subsequently having noticed that the Copper and Aluminum elements would not permit the exemption under the Notification at the rate of 2.5% by itself would not make the import of the goods as clandestinely having been done, the least that could have been done was to term the same as mala fide when otherwise the relevant material had been already placed with the department - the communication dated 03.08.2020 in post clearance audit of Bill of Entry was on the basis of various documents including the certificate of analysis, when it was realized by the department that the product consists of the Copper scrap also to the extent of around 10%. The DRI has firstly detained the goods, which later on had been seized. Assuming that the stage of adjudication of show cause notice is yet to come, this Court has no intent to go into the issue of classification at all as it would be for the proper officer to workout the same on following the due procedure and on requisite scrutiny however, noticing that the order of detention and seizure by the DRI itself is unsustainable, we allow the petition by quashing and setting aside the seizure and the panchnama.

Petition allowed.