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2022 (2) TMI 207 - AT - CustomsJurisdiction - notice not issued by competent person - scope of 'Proper Officer' - Valuation of imported goods - mis-declaration of value in the 11 Bills of Entry - rejection of declared value - demand of differential duty - Section 28(4) of Customs Act - Confiscation - penalties - HELD THAT:- The constitutional validity of section 28(11) of the Act was challenged before the High Court of Delhi in the case of M/S MANGALI IMPEX LTD., M/S PACE INTERNATIONAL AND OTHERS VERSUS UNION OF INDIA AND OTHERS [2016 (5) TMI 225 - DELHI HIGH COURT]. The High Court held that the section is constitutionally valid but set aside its retrospective application. Revenue appealed to the Supreme Court and the operation of this judgment and order of the Delhi High Court was stayed by the Supreme Court [2016 (8) TMI 1181 - SC ORDER] - Sub-section (11) of section 28 of the Act has not been set aside by any High Court or Supreme Court and hence it continues to be in force till date. In fact, its constitutional validity has been examined and upheld by the High Court of Delhi in Mangali Impex. Thus, after the amendment, there are several “proper officers‟ under section 17 with respect to the same type of goods imported through the same port/ airport/land customs station such as the assessing officer of the Appraising Group (appraiser or Assistant Commissioner or Deputy Commissioner) of the Custom House, the officers of the preventive Commissionerates who have jurisdiction over the area, the central excise officers who may have been notified as customs officers in the area, officers of Directorate of Revenue Intelligence who have jurisdiction over the area, etc. The decision of Supreme Court in M/S CANON INDIA PRIVATE LIMITED VERSUS COMMISSIONER OF CUSTOMS [2021 (3) TMI 384 - SUPREME COURT] is not only that officers of DRI were not proper officers under Section 2(34) of the Act, but the power of issuing a notice under Section 28 of the Act is conferred on “the proper officer’ and not a proper officer or any proper officer. The proper officer for this purpose is held to be the officer of the appraising group who has assessed the Bill of Entry in the first place or his successor in office. This is because the notice under section 28 of the Act is a power of re-opening an assessment which is not inherent and is specially conferred on the assessing officer who alone can exercise it. As the SCN itself has been issued in this case by a person not competent to issue a demand under section 28 of the Act, the demand cannot be sustained. Neither can the proposals for confiscation and imposition of penalties which follow the confirmation of such demand - Demand do not sustain - appeal allowed - decided in favor of appellant.
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