TMI Blog2021 (8) TMI 178X X X X Extracts X X X X X X X X Extracts X X X X ..... proceedings including the assessment orders or orders passed on an appeal and other orders of the superior authorities. Accordingly, the contention regarding jurisdiction as raised by the second respondent is liable to be rejected. Alternate Remedy - HELD THAT:- The Apex Court in the case of M/s.Canon India Private Limited has unequivocally dealt with the point of jurisdiction of the Officers of DRI in the context of proper officer and in light of the unequivocal findings made there is no necessity for any re-adjudication of such an issue and accordingly, the question of relegating the party to avail of the statutory remedy would not arise. Res Judicata - HELD THAT:- The dispute on hand in the present case however is one that relates to valuation and not as regards to the tariff applicable and that comes out clearly from the contents of the show-cause notice dated 07.01.2008 and this position regarding distinct nature of dispute of the show-cause notice relating to the judgment of the Supreme Court in the case of GIAVUDAN INDIAN PVT. LTD. VERSUS COMMISSIONER OF CUSTOMS, BANGALORE [ 2009 (12) TMI 786 - CESTAT BANGALORE] as well as the present dispute is clear even on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... V Petitioner: Sri S.S. Naganand, Senior Advocate a/w Sriyuths B. Venugopal And Hariradhakrishnan, Advocates Respondents: Sri M.B. Nargund, Additional Solicitor General And Sri Amit Deshpande, Advocate ORDER Writ Petition No.10773/2018 and Writ Petition No.4628/2018 are taken up together and disposed off by a common order in light of the prayer sought for in both the petitions being identical as the Order-in-original Sl.No.BLR- CUSTM-AIR-003/16-17 dated 27.02.2017 at Annexure-G passed by the first respondent has been called in question. 2. Further in both the petitions, a writ of mandamus is also sought to direct the respondent to keep the adjudication proceedings arising out of the show-cause notice dated 07.01.2008 at Annexure-B in call book in terms of the Master Circular bearing No.1053/02/2017-CX dated 10.03.2017 passed by the Central Board of Excise and Customs. The petitioner in W.P.No.4628/2018 is the Company, while the petitioner in W.P.No.10773/2018 is the Director of the Company. 3. The relevant facts are that the petitioner Company (in W.P.4628/2018) is stated to be engaged in the business of trading and manufacture of flavours and fragrances ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CC Online SC 200 (in Civil Appeal No.1827/2018 and connected matters) has laid down the law as regards to the aspect of who is 'the proper officer' for the purpose of Section 28 of 'The Customs Act, 1962' and wherein the proceedings initiated by the Additional Director General of DRI who had issued the show-cause notice was declared invalid as he was not a 'proper officer' as defined under the Act and that the said judgment would enure to the benefit of the petitioners also insofar as orders-in-original that were passed which were the subject matter of litigation has commenced with show-cause notice dated 07.01.2008 which was issued by the Additional Director General of Directorate of Revenue Intelligence, Bengaluru ( DRI for short) who has been held as not being 'the proper officer'. It is contended that in light of the said judgment in M/s. Canon India Private Limited (supra), the impugned Order-in-Original dated 27.02.2017 which was culmination of the proceedings starting with the show-cause notice issued by an incompetent authority is liable to be set aside. 10. Sri. M.B.Nargund, the learned Additional Solicitor General appearing for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in W.P.No.3144/2016 and connected matters dated 15.04.2021 wherein, while noticing the identical contention raised regarding the definition of 'the proper officer' in the context of the judgment in M/s.Canon India Private Limited (supra), the court was of the view that as against the orders-in-original passed by the Authorities as there was a remedy by way of an appeal under Section 128 and 129 of the Customs Act, the petitioners having approached the court directly without exhausting such remedy ought to be relegated to avail of the substantive remedy of filing an appeal. 12. It was further contended that the case of M/s.Canon India Private Limited (supra) cannot be made applicable without examining the relevant facts and it was submitted that the court needs to keep in mind that Section 28(11) remains undisturbed and accordingly, the petitioners are not entitled for the relief sought for. It was further pointed out that the question of jurisdiction for issuance of show-cause notice and that the officer of the Directorate of Revenue Intelligence is not 'the proper officer', has not been taken note of at the first instance. 13. It was submitted on b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... South Central Railway Employees Co-operative Credit Society Employees Union vs. B. Yashodabai reported in (2015) 1 SCC (LS) 582 and has drawn attention to the observation of the Apex Court that it is not open for the High Court to go beyond the judgment of the Apex Court and hold that it is per-incurium. Attention is also drawn to the judgment of the Apex Court in the case of Suganthi Suresh Kumar vs. Jagdeeshan reported in AIR 2002 SC 681 to contend that it is a matter of discipline that in light of Article 141, the law declared by the Supreme Court is to be followed and the correctness of the said judgment cannot be gone into even if the point urged has not been considered by the Supreme Court. 16. It is also submitted that the proceedings in the present case relates to the period 2003-07 and that the law that would be applicable would be that of the Apex Court in the case of Commissioner of Customs vs. Sayed Ali reported in 2011 (265) E.L.T. 17 (SC) and the subsequent amendment made to Section 28 including Section 28 (11) would only be prospective and this is made clear by virtue of Explanation 2 to Section 28 which clarifies that with respect to non-levy, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Revenue based on difference in valuation cannot amount to suppression in the sense as contended by the respondent. 20. Heard both sides. 21. The point for consideration is : Whether the Order-in-Original dated 27.02.2017 is liable to be set aside as not being passed by a proper Officer in light of the judgment of the Apex Court in the case of M/s.Canon India Private Limited vs. Commissioner of Customs ? 22. Prior to answering the aforesaid point for consideration, certain other objections raised regarding maintainability of the present petitions and calling upon the court to dismiss the petitions and bar the petitioners from availing the discretionary jurisdiction under Article 226 of the Constitution of India, due to suppression of facts and also on the ground of res judicata is required to be answered. 1) Objection to Jurisdiction raised at a belated stage: (i) It was the contention raised on behalf of the second respondent that the petitioners had not raised the objection to jurisdiction at the first stage of adjudication. (ii) It is not in dispute that the proceedings that were initiated at the first instance was remanded for fresh consideration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oted that entertaining of writ petition even where statutory right of appeal is available is a matter of discretion and restraint left to the court and the availability of statutory right of appeal by itself would not bar the court from entertaining the writ petition. It would be appropriate to refer to the judgment of the Apex Court in the case of Whirlpool Corporation (supra), wherein the Apex Court at Para 15 has observed that in case of three contingencies, a writ could be directly entertained viz., where the writ petition has been filed for the enforcement of any of the Fundamental Rights or where there has been a violation of principles of natural justice or where the order or proceedings are wholly without jurisdiction or the vires of an Act is challenged. The said observation reflects a position of settled law with respect to which there is no dispute. (iv) The Apex Court in the case of M/s.Canon India Private Limited (supra) has unequivocally dealt with the point of jurisdiction of the Officers of DRI in the context of proper officer and in light of the unequivocal findings made there is no necessity for any re-adjudication of such an issue and accordingly, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... estige Meridian 1, # 29, M.G.Road, Bangalore (a 100% subsidiary of M/s.Givaudan S.A., Switzerland) for suppression and mis declaration of alcohol content in thier imports of Mixtures of Odoriferous Substances imported from the group companies of Givaudan Switzerland and wrong availment of concession under Sl.No.119 of Customs Notification No.21/02 dtd. 01.03.02. This importer admitted the fact of suppression and misdeclaration of alcohol content and availment of ineligible concession under Customs notification No.21/02 dtd. 01.03.02 and paid ₹ 2.10 Crores during the stage of investigation itself before the issue of Show Cause Notice No.S/IV/16/2006 dtd. 25.01.07. 3. During the course of investigation of the offence case mentioned in para 2.2 above, the preliminary scrutiny of seized records/data downloaded by DRI revealed that the imports of aromatic chemicals [termed as Fragrance Ingredients Business Unit (FIBU) items] made by VPL were undervalued and the undervaluatoin was found to be in the range of 3% to 375% during the period 2002 to 2007. The said undervaluation has been witnessed from the following: (i) The evidences such as the International price lists fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... show-cause notice relating to the judgment of the Supreme Court in the case of Givaudan India Pvt. Ltd. vs. Commissioner of Customs, Bangalore reported in 2010 (261) E.L.T. 975 (Tri.-Bang) as well as the present dispute is clear even on a bare perusal of the material on record and does not involve any complicated factual enquiry necessitating relegation of the parties to the remedy of appeal. Accordingly, the question of res judicata would not be a bar to the adjudication of the present proceedings nor does it necessitate the relegating authority to avail of the statutory remedy of appeal. (viii) In fact, it ought to be noticed that during the previous round of litigation, the question of proper officer was not considered by the Apex Court nor raised and even otherwise, during the pendency of the present proceedings the judgment of the Apex Court in the case of M/s.Canon India Private Limited (supra) has clarified as to who is the proper officer, and it cannot be stated that the assessee is debarred from taking the benefit of law laid down by the Apex Court which goes to the root of the matter. In light of the law laid down by the Apex Court, the officer who has issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which is directly applicable, the question of non-suiting the petitioners on the ground as made out at this stage would be wholly inappropriate. 5) Applicability of judgment in M/s.Canon India Private Limited: (i) It is to be noticed that the starting point of the present proceedings relates to the show cause notice dated 07.01.2008 which relates to the period prior to 2011. Certain amendments were made to the Customs Act, 1962 in 2011. Under Section 28 of the Customs Act as was applicable during the relevant period of time, the power is vested in 'the proper officer' to take action where duty has not been levied or has been short-levied or erroneously refunded and such proceedings was to be taken by 'the proper officer.' Subsequent to the amendment of Section 28, 'the proper officer' still retains jurisdiction, though there are certain procedural modifications. (ii) The aspect of who is 'the proper officer' as regards to Section 28 of the Customs Act prior to the amendment was considered by the Apex Court in the case of Commissioner of Customs v. Sayed Ali and Another reported in (2011) 265 ELT 17 . Subsequent to the judgment of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y, the user of the definite article the before the word agreement is, in our view, very significant. Parliament has not said an agreement or any agreement for or in relation to such export and in the context the expression the agreement would refer to that agreement which is implicit in the sale occasioning the export. The Apex Court while referring to ' the proper officer' found in Section 28 has specifically recorded a finding that it is only 'the proper officer', and 'that proper officer' alone can adjudicate the matter. Further Apex Court has clarified at para 15 as follows: 15. ...... We find it completely impermissible to allow an officer, who has not passed the original order of assessment, to re-open the assessment on the grounds that the duty was not paid/not levied, by the original officer who had decided to clear the goods and who was competent and authorised to make the assessment. The nature of the power conferred by Section 28(4) to recover duties which have escaped assessment is in the nature of an administrative review of an act. The section must therefore be construed as conferring the power of such review on the same ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent case initiated by the Additional Director General of the DRI by issuing show cause notices in all the matters before us are invalid without any authority of law and liable to be set-aside and the ensuing demands are also set-aside . (ix) In the present case, applying the law laid down in the case of M/s.Canon India Private Limited (supra) clearly, the proceedings that have been initiated by issuance of a show cause notice dated 07.01.2008 by the Additional Director General, DRI is also liable to be set aside in light of the law laid down by the Apex Court as referred to above. 23. While judgment of High Court of Madras in the case of Commissioner of Customs (Air) vs. M/s. Premier Tours Travels (Chennai) Pvt. Ltd. and another , in C.M.A. No.2746/2009 and M.P. No.1/2009 dated 04.02.2021 where identical contentions were raised and the consideration of such aspect has been relegated to be decided in the appeal, however this Court does not find any reason to take the same view, in light of the clear findings in the case of M/s.Canon India Private Limited (supra) which does not leave any scope for further adjudication and the law laid down by the Apex Court ought to ..... 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