TMI Blog2016 (7) TMI 123X X X X Extracts X X X X X X X X Extracts X X X X ..... to the case of the present petitioners. Therefore, the impugned show cause notice dated 13.3.2005, the adjudication order dated 25.6.2010 and consequential recovery proceedings, are rendered non est and void ab initio on the vice of jurisdiction and are as such quashed and set aside. - Decided in favor of the assessee. - CWP No. 12678 of 2016 - - - Dated:- 30-6-2016 - M. Jeyapaul And A. B. Chaudhari, JJ. For the Petitioners : Mr. Harshit Sethi, Advocate. For the Respondents : Mr. Shern Sethi, Senior Standing Counsel ORDER M. Jeyapaul, J. 1. Affidavit on behalf of respondent no. 2 filed and the same is taken on record. Heard the elaborate submissions made by learned counsel appearing for the writ petitioners and learned counsel for respondents no. 2 and 3. 2. In this Writ Petition, the petitioners challenge is to the Show Cause Notice bearing No. DRI F.No. 856(20)LDH/2004/380 dated 13.3.2005 and the consequential proceedings including the Adjudication Order dated 25.6.2010. This challenge is centered on the premises that the said Notice is issued by Respondent No. 2 Additional Director General, Directorate of Revenue intelligence, Ludhiana, who is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Imports) or the Preventive Collectorate, would be 'proper officers'. In our view, therefore, it is only the officers of Customs, who are assigned the functions of assessment, which of course, would include reassessment, working under the jurisdictional Collectorate within whose jurisdiction the bills of entry or baggage declarations had been filed and the consignments had been cleared for home consumption, will have the jurisdiction to issue notice under Section 28 of the Act. ..........We are convinced that Notification Nos. 250-Cus and 251-Cus. Both dated 27th August 1983, issued by the central government in exercise of the powers conferred by sub-section (1) of the Section 4 of the Act, appointing Collector of Customs (Preventive), etc. to be the Collector of Customs for Bombay, Thane and Kolaba Districts in the State of Maharashtra did not ipso facto confer jurisdiction on him to exercise power entrusted to the 'proper officers' for the purpose of Section 28 of the Act. 5. The Hon'ble Supreme Court rejected the contention of the Department that the source of power to act as 'proper officer' was Sections 4 and 5 of the Act and not sub-se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ulty faced, if any, may be brought to the notice of the Board. 8. On 6.7.2011, Notification No. 44 of 2011-Customs was issued by the Central Board of Excise and Customs which thereby assigned the functions of the proper officer inter alia to the Additional Director Generals in the Directorate General of Revenue Intelligence for the purpose of Sections 17 and 28 of the Act in exercise of the powers conferred by Section 2(34) of the Act. Thus, after this date the Additional Director General of Revenue Intelligence could issue show cause notice under Section 28. However, the said power was not given with any retrospective effect. 9. On 2.8.2011 the Customs (Amendment and Validation) Act, 2011 was introduced in Parliament proposing to add another sub-section 11 after sub-section 10 of the said new Section 28 of the Act. The Statement of Objects and Reasons (SOR) referred to the judgment of the Hon'ble Supreme Court of India in Sayed Ali (supra) and the said notification dated 6th July, 2011 specifically declaring certain officers as proper officers for the purposes of Sections 17 and 28. It was sought to clarify that Show Cause Notices issued inter alia by Directorate Gene ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch of the writ petitions before the Hon'ble Delhi High Court were disposed of vide the aforesaid judgment dated 3.5.2016 in M/s Pace International (supra). The Hon'ble Delhi High Court while setting aside the show cause notices issued prior to 8.4.2011 arrived at, inter alia, the following conclusions:- 47. ....................In other words, the newly enacted Section 28 (11) would not empower the officers of the DRI and DGCEI to either proceed to adjudicate SCNs already issued by them for the period prior to 8th April 2011 or to issue SCNs for a period prior to 8th April 2011. 62. There is merit in the contention that Section 28 (11) is overbroad in as much as it confers jurisdiction on a plurality of officers on the same subject matter which would result in chaos, harassment, contrary and conflicting decisions. Such untrammelled power would indeed be arbitrary and violative of Article 14 of the Constitution. 65. The attempt by the Department to refer to the SOR to justify overlooking Explanation 2 in favour of Section 28(11) cannot be possibly countenanced. The statute has to be read for what it actually states. It is only where there is some ambiguity w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iscussion is that the Department cannot seek to rely upon Section 28(11) of the Act as authorising the officers of the Customs, DRI, the DGCEI etc. to exercise powers in relation to non-levy, short-levy or erroneous refund for a period prior to 8th April 2011 if, in fact, there was no proper assigning of the functions of reassessment or assessment in favour of such officers who issued such SCNs since they were not 'proper officers' for the purposes of Section 2(34) of the Act and further because Explanation 2 to Section 28 as presently enacted makes it explicit that such non-levy, short-levy or erroneous refund prior to 8th April 2011 would continue to be governed only by Section 28 as it stood prior to that date and not the newly re-cast Section 28 of the Act. 70.2 Section 28(11) interpreted in the above terms would not suffer the vice of unconstitutionality. Else, it would grant wide powers of assessment and enforcement to a wide range of officers, not limited to customs officers, without any limits as to territorial and subject matter jurisdiction and in such event the provision would be vulnerable to being declared unconstitutional. 70.3 As regards the perio ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
