Commissioner of Income Tax-I vs. M/s. BDR Projects Pvt. Ltd.

W.P. (C) 441/2013 & connected matters

Page 1 of 66

$~ * IN THE HIGH COURT OF DELHI AT NEW DELHI

Reserved on: February 17/18,2016

Decision on: May 3, 2016

W.P.(C) 441/2013

MANGALI IMPEX LTD

..... Petitioner

Through: Mr Naveen Malhotra, Advocate.

versus

UNION OF INDIA AND ORS

..... Respondents

Through: Mr S.K. Dubey, Advocate for DRI. Mr Satish Kumar, Senior Standing Counsel for R3 and R4.

Mr Rahul Kaushik, Senior Standing Counsel

with Mr Bhavishya Sharma, Advocate for

Customs.

With

W.P.(C) 8196/2013 & CM 17295/2013

SONY INDIA PRIVATE LIMITED

..... Petitioner Through: Mr V. Lakshmi Kumaran, Advocate with Mr Abhinav Jagnathan, Advocate.

versus

UNION OF INDIA

..... Respondent Through: Mr Sanjev Kumar Dubey, Advocate with Mr Rajmangal Kumar, Mr Udit Malik, Advocate and Mr Aman Singh Paras, Advocate for DRI. Mr Satish Kumar, Senior Standing Counsel for R3.

With

W.P.(C) 211/2014 & CM 389/2014

K.S.TRADERS

..... Petitioner

W.P. (C) 441/2013 & connected matters

Page 2 of 66

Through: Mr Naveen Malhotra, Advocate.

versus

UNION OF INDIA & ORS.

..... Respondents

Through: Mr Akshay Makjhija, CGSC with Mr Vikas Bhadauria, Advocate for UOI. Mr S.K. Dubey, Advocate with Mr Udit Malik, and Mr Rajmangal Kumar, Advocate for DRI. Ms Sonia Sharma, Senior Standing Counsel with Mr C.P. Pandey, Advocate for R3.

With

W.P.(C) 863/2014 & CM 1731/2014

SENNHEISER ELECTRONICS INDIA PVT LTD ..... Petitioner

Through: Mr V. Lakshmi Kumaran and Mr Abhinav Jaganathan, Advocates.

versus

UNION OF INDIA & ORS

..... Respondents

Through: Mr Akshay Makhija, CGSC and Mr Vikas Bhadauria, Advocate for UOI. Mr Sanjev Kumar Dubey, Advocate with Mr Rajmangal Kumar, Mr Udit Malik, Advocate and Mr Aman Singh Paras, Advocate for DRI.

With

W.P.(C) 3803/2014 & CM 7658/2014

COMET IMPEX

..... Petitioner

Through: Mr C. Hari Shankar, Senior Advocate with Mr S. Sunil and Mr P.K. Singh, Advocates.

Versus

UNION OF INDIA & ORS

..... Respondents Through: Mr Ripu Daman Bhardwaj, CGSC

W.P. (C) 441/2013 & connected matters

Page 3 of 66

with Mr T.P. Singh, Advocate for R1. Mr S.K. Dubey, Advocate with Mr Udit

Malik and Mr Rajmangal Kumar, Advocate for

DRI.

Mr Sanjeev Kumar Dubey, Advocate with Mr Rajmangal Kumar, Mr Udit Malik and Mr Aman Singh Paras, Advocate for DRI.

With

W.P.(C) 5262/2014

RAJESH GUPTA

..... Petitioner

Through: Mr Rajesh Mahana, Advocate.

versus

UNIO N OF INDIA AND ORS

..... Respondent

Through: Mr Akshay Makhija, CGSC and Mr Vikas Bhadauria, Advocate for UOI. Mr Satish Aggarwala, Advocate with Mr Vineet Sharma, Advocate for DRI.

With

W.P.(C) 5877/2014 & CM 14409/2014

DAIKIN AIRCONDITIONING INDIA PRIVATE .LTD.

..... Petitioner

Through: Mr V. Lakshmi Kumaran and Mr Abhinav Jaganathan, Advocates.

Versus

UNION OF INDIA & ORS.

..... Respondent

Through: Mr Akshay Makhija, CGSC with Mr Vikas Bhadauria, Advocate for UOI. Mr Sanjev Kumar Dubey, Advocate with Mr Rajmangal Kumar, Mr Udit Malik, Advocate and Mr Aman Singh Paras, Advocate for DRI.

Mr Satish Kumar, Senior Standing Counsel for

W.P. (C) 441/2013 & connected matters

Page 4 of 66

With

W.P.(C) 4162/2015 & CM 10559/2015

GODREJ AND BOYCE MANUFACTURING CO. LTD.

..... Petitioner Through: Mr Arshad Hidyatullah, Senior Advocate with Mr Rupesh Kumar, Mr Pravesh Bhauguna, Mr Jitin Singhal and Mr Pratik Raoka, Advocates

versus

UNION OF INDIA & ORS.

..... Respondents

Through: Mr Ajitesh Kumar, Advocate for Mr Gaurav Sarin, Advocate for R1. Mr Satish Aggarwala, Advocate with Mr Vineet Sharma, Advocate for DRI.

With

W.P.(C) 11285/2015

CORTEL INDIA

..... Petitioner

Through: Mr Naveen Malhotra, Advocate.

Versus

UNION OF INDIA & ORS

..... Respondents

Through: Mr Satish Aggarwala, Advocate with Mr Vineet Sharma, Advocate for DRI. Mr Sanjeev Kumar Dubey, Advocate with Mr Rajmangal Kumar, Mr Udit Malik and Mr Aman Singh Paras, Advocate for DRI. Mr Umesh Sharma, Senior CGSC with Mr Akshat Kumar, CGSC. Mr Kamal Nijhawan, Senior Standing Counsel for R-2.

With

W.P.(C) 11853/2015 & CM 31504/2015

EASTRON OVERSEAS INC

..... Petitioner

W.P. (C) 441/2013 & connected matters

Page 5 of 66

Through: Mr Naveen Malhotra, Advocate.

versus

UNION OF INDIA & ORS.

..... Respondents Through: Mr Ripu Daman Bhardwaj, CGSC with MrT.P. Singh, Advocate for R1. Mr Kamal Nijhawan, Senior Standing

Counsel for R2.

Mr Sanjeev Kumar Dubey, Advocate for DRI.

With

W.P.(C) 11854/2015 & CM 31506/2015

DIVYA ELECTRONICS

..... Petitioner

Through: Mr Naveen Malhotra, Advocate.

Versus

UNION OF INDIA & ORS

..... Respondents

Through: Mr S.K. Dubey, Mr Udit Malik and Mr Rajmangal Kumar, Advocates for DRI. Mr Satish Aggarwala, Advocate with Mr Vineet Sharma, Advocate for DRI. Mr Kamal Nijhawan, Senior Standing Counsel for R2. Mr Riput Daman Bhardwaj, CGSC with Mr T.P. Singh, Advocate for R1.

And +

W.P.(C) 563/2016 & CM 2353/2016

RAJESH TRIPATHI

..... Petitioner

Through: Mr Naveen Malhotra, Advocate.

Versus

UNION OF INDIA & ORS.

..... Respondents

Through: Mr Ajay Digpaul, CGSC for R1. Mr S.K. Dubey, Advocate witgh Mr Udit

Malik and Mr Rajmangal Kumar, Advocates for

DRI.

W.P. (C) 441/2013 & connected matters

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Mr Satish Aggarwala, Advocate with Mr Vineet

Sharma, Advocate for DRI. Mr Kamal Nijhawan, Senior Standing Counsel for R-2. Mr Raghvendra Singh and Mr Rahul Chaudhary, Advocates.

W.P.(C) 1185/2013 & CM 2240/2013

M/S LAKSHMAN OVERSEAS AND ORS ..... Petitioners

Through: Mr Akshay Chandra & Mr Raktim

Gogoi, Advocates.

versus

UNION OF INDIA AND ORS

..... Respondents

Through: Mr S.K. Dubey, Advocate with Mr Rajmangal Kumar and Mr Udit Malik, Advocates. Mr Satish Kumar, Senior Standing Counsel for R2 and R4.

W.P.(C) 7383/2013 & CM 15847/2013

M/S PACE INTERNATIONAL & ANR.

..... Petitioners

Through: Mr Akshay Chandra & Mr Raktim

Gogoi, Advocates.

versus

UNION OF INDIA & ORS.

..... Respondents

Through: Mr Arun Bhardwaj, CGSC/UOI.

Mr Rahul Kaushik, Senior Standing Counsel CBEC with Mr Bhavishya Sharma, Advocate for Customs.

W.P.(C) 225/2014 & CM 416/2014

BHARAT SANCHAR NIGAM LIMITED ..... Petitioner

Through: Mr R.K. Sanghi and Mr satyendra

Kumar and Mr Palash, Advocates.

versus

UNION OF INDIA & ORS.

..... Respondents

Through: Mr S.K. Dubey, Advocate with Mr Rajmangal Kumar and Mr Udit Malik,

W.P. (C) 441/2013 & connected matters

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Advocate for DRI. Mr Amit Mahajan, CGSC for UOI.

W.P.(C) 4841/2015 & CM 8739/2015

SATYAM MARKETING THROUGH: ITS PROPRIETOR

..... Petitioner

Through: Mr Prosenjit Mandal and Mr Umang

Srivastav, Advocates.

versus

UNION OF INDIA & ORS.

..... Respondents

Through: Mr S.K. Dubey, Advocate with Mr Rajmangal Kumar and Mr Udit Malik, Advocate. Mr Vivek Goyal, CGSC with Mr Prabhakar Srivastav,Advocate for UOI/R1. Mr Akshay Makhija, CGSC for UOI. Mr Satish Kumar, Senior Standing Counsel for R3.

W.P.(C) 5191/2015 & CM 9414/2015, 9416/2015

MANOJ SABOO @ MANOJ MAHESHWARI ..... Petitioner

Through: Mr Pawan Shree Agarwal, Advocate

with Mr Ayush Sharma, Advocate.

versus

UNION OF INDIA & ORS.

..... Respondents

Through: Mr S.K. Dubey, Advocate with Mr Rajmangal Kumar and Mr Udit Malik, Advocate. Ms Suparna Srivastava, Senior Standing

counsel for UOI with Mr Manu Dev Sharma,

Advocate. Mr Satish Aggarwala, Advocate for

DRI. Mr Satish Kumar, Senior Standing Counsel for R3.

W.P.(C) 9379/2015 & CM 21818/2015

HANSRAJ BHATIA & CO. THROUGH: ITS PROPRIETOR SHRI SANJEEV BHATIA ..... Petitioner

Through: Mr Piyush Kumar and Ms Reena

Rawat, Advocates.

W.P. (C) 441/2013 & connected matters

Page 8 of 66

versus

UNION OF INDIA & ORS.

..... Respondents

Through: Mr S.K. Dubey, Advocate with Mr Rajmangal Kumar and Mr Udit Malik, Advocate. Mr Kamal Nijhawan, Advocate with Mr Sumit Gaur, Advocate for R3. Mr Satish Aggarwala, Advocate for DRI. Mr Anurag Ahluwalia, CGSC with Mr Prashant Ghai, Advocate for UOI.

W.P.(C) 11041/2015 & CM 28502/2015

M/S. J.R. INTERNATIONAL

..... Petitioner

Through: Mr Prem Ranjan Kumar, Advocate.

versus

UNION OF INDIA & ORS.

..... Respondents

Through: Mr S.K. Dubey, Advocate with Mr Rajmangal Kumar and Mr Udit Malik, Advocate for DRI. Mr Satish Kumar, Senior Standing Counsel for R3.

W.P.(C) 11806/2015 & CM 31354/2015

BHAGWATI COMPONENTS MFG.CO. THROUGH: ITS DIRECTOR MR. SURJIT SINGH

..... Petitioner Through: Mr Rupender Sinhman, Advocate with Ms Rubal Maini, Advocate.

versus

UNION OF INDIA & ORS.

..... Respondents

Through: Mr S.K. Dubey, Advocate with Mr Rajmangal Kumar and Mr Udit Malik, Advocate for DRI. Ms Sonia Sharma, Senior Standing Counsel with Mr C.P. Pandey, Advocate for R3. Mr Satish Aggarwala, Advocate for DRI.

CORAM:

JUSTICE S.MURALIDHAR

JUSTICE VIBHU BAKHRU

W.P. (C) 441/2013 & connected matters

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J U D G M E N T %

03.05.2016

Dr. S. Muralidhar, J.:

Introduction 1. The common question in this batch of matters pertains to the constitutional validity of Section 28 (11) of the Customs Act, 1962 („Act‟) which was inserted by the Customs (Amendment and Validation) Act, 2011 („Validation Act, 2011‟) with effect from 16th September 2011. In terms of Section 28 (11) of the Act, all persons appointed as Customs Officers under Section 4 (1) of the Act prior to 6th July 2011 “shall be deemed to have and always had the power of assessment under Section 17 and shall be deemed to have been and always had been the proper officers.....”

W.P. (C) 441/2013 & connected matters

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Relevant provisions of the Act 6. In order to appreciate the above central issue that arises, it is necessary to first examine the background of the provisions of the Act. Under the Act as it stood prior to the Validation Act 2011, the relevant provisions read as follows.

W.P. (C) 441/2013 & connected matters

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Section 17, provisional assessment of duty under Section 18, the exercise of the power to issue SCN under Section 28 where there has been non- levy, short-levy or erroneous refund of customs duty or where any interest payable has not been paid or part-paid or erroneously refunded. It is only a proper officer who can exercise jurisdiction under the above provisions and certain other provisions which explicitly state that the powers therein are to be exercised only by a proper officer.

(a) in the case of any import made by any individual for his personal use or by government or by any educational, research or charitable institution or hospital, within one year;

(b) in any other case, within six months, from the relevant date, serve notice on the person chargeable with the duty or interest which has not been levied or charged or which has been short-levied or part paid or to whom the refund has erroneously been made, requiring him to show cause why he should not pay the amount specified in the notice: Provided that where any duty has been levied or has been short- levied or the interest has not been charged or has been part paid or the duty or interest has been erroneously refunded by reason of collusion or any wilful mis-statement or suppression of facts by the importer or the exporter or the agent or employee of the importer or exporter, the provisions of this sub-section shall have effect as if

W.P. (C) 441/2013 & connected matters

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for the words "one year" and "six months", the words "five years" were substituted. Provided further that where the amount of duty which has not been levied or has been short-levied or erroneously refunded or the interest payable has not been paid, part paid or erroneously refunded is one crore rupees or less, a notice under this sub-section shall be served by the Commissioner of Customs or with his prior approval by any officer sub-ordinate to him: Provided also that where the amount of duty has not been levied or has been short-levied or erroneously refunded or the interest payable thereon has not been paid, part paid or erroneously refunded is more than one crore rupees, no notice under this sub- section shall be served except with the prior approval of the Chief Commissioner of Customs. Explanation : Where the service of the notice is stayed by an order of a court, the period of such stay shall be excluded in computing the aforesaid period of one year or six months or five years, as the case may be. (2) The proper officer, after considering the representation, if any, made by the person on whom notice is served under sub-section (1), shall determine the amount of duty or interest due from such person (not being in excess of the amount specified in the notice) and thereupon such person shall pay the amount so determined. (2A) Where any notice has been served on a person under sub- section (1), the proper officer – (1) in case any duty has not been levied or has been short-levied, or the interest has not been paid or has been part paid or the duty or interest has been erroneously refunded by reason of collusion or any wilful mis-statement or suppression of facts, where it is possible to do so, shall determine the amount of such duty or the interest, within a period of one year: and (2) in any other case, where it is possible to do so, shall determine the amount of duty which has not been levied or has been short- levied or erroneously refunded or the interest payable which has not been paid, part paid or erroneously refunded, within a period of six months, from the date of service of the notice on the person under sub- section (1).

W.P. (C) 441/2013 & connected matters

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(2B) Where any duty has not been levied, or has been short-levied or erroneously refunded, or any interest payable has not been paid, part paid or erroneously refunded, the person, chargeable with the duty or the interest, may pay the amount of duty or interest before service of notice on him under sub-section (1) in respect of the duty or the interest, as the case may be, and inform the proper officer of such payment in writing, who, on receipt of such information, shall not serve any notice under sub-section (1) in respect of the duty or the interest so paid: Provided that the proper officer may determine the amount of short-payment of duty or interest, if any, which in his opinion has not been paid by such person and, then, the proper officer shall proceed to recover such amount in the manner specified in this section, and the period of “one year” or “six months” as the case may be, referred to in sub-section (1) shall be counted from the date of receipt of such information of payment. Explanation 2. For the removal of doubts, it is hereby declared that the interest under Section 28AB shall be payable on the amount paid by the person under this sub-section and also on the amount of short-payment of duty, if any, as may be determined by the proper officer, but for this sub-section. (2C) The provisions of sub-Section (2B) shall not apply to any case where the duty or the interest had become payable or ought to have been paid before the date on which the Finance Bill 2001 receives the assent of the President. (3) For the purposes of sub-section (1), the expression "relevant date" means,- (a) in a case where duty is not levied, or interest is not charged, the date on which the proper officer makes an order for the clearance of the goods; (b) in a case where duty is provisionally assessed under section 18, the date of adjustment of duty after the final assessment thereof; (c) in a case where duty or interest has been erroneously refunded, the date of refund; (d) in any other case, the date of payment of duty or interest.”

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The decision in Sayed Ali 11. At this stage, it is necessary to examine in some detail the decision of the Supreme Court in Sayed Ali (supra). The facts of the case were that Respondent No. 1 was a partner of Respondent No. 2 firm, M/s. Handloom Carpet, which was engaged in the business of carpet manufacture and export. The firm was charged with having misused the Export Passbook Scheme by selling goods cleared duty free in the open market or selling the passbook on premium in violation of the ITC restriction imposed on such sale. The investigations in the matter were conducted by the Marine and Preventive Wing of the Customs.

W.P. (C) 441/2013 & connected matters

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since the subject matter involved a demand of duty beyond a period of six months, the SCN was required to be issued by the Collector, and not by the Assistant Collector. Nevertheless, the Collector (Appeals) granted liberty to the Customs Department to re-adjudicate the case by issuing a proper SCN.

(ii) of the Act were also proposed.

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also ordered confiscation of two consignments of dyes, sulphur blue and sulphur blue green. Aggrieved by the above order, the Respondents went in appeal before the Customs, Excise and Gold (Control) Appellate Tribunal („CEGAT‟). A preliminary objection was raised before the CEGAT by the Respondents regarding jurisdiction of the Collector of Customs (Preventive). In this regard the CEGAT in the said impugned order observed as under: “It is very clear that the Commissioner of Customs (Preventive) does not have jurisdiction to issue the impugned show-cause notice and in view thereof he could not have the jurisdiction to adjudicate the matter when imports have taken place at Bombay Customs House.”

(98) ELT 821 (Tri), which attained finality by the dismissal of the Revenue‟s appeal by the Supreme Court in CCE & Customs v. Manohar Bros. (Capacitors) (2011) 3 SCC 580.

W.P. (C) 441/2013 & connected matters

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W.P. (C) 441/2013 & connected matters

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(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.”

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CBEC Instruction 22. Immediately after the decision of the Supreme Court in Sayed Ali (supra) on 18th February 2011, instructions were issued on 15th April 2011 by the CBEC to all officers of the Customs Preventive and DRI inter alia as under: “2. In view of Hon‟ble Supreme Court order, while other alternative measures are being considered to address the matter, it has been decided by the Board that henceforth all show cause notices under Section 28 of the Customs Act, 1962 in respect of cases investigated DRI/Customs Preventive formations are required to be issued by jurisdictional Commissioners from where imports have taken place. Board also desires the field formations to examine the pending show cause notices and wherever the cases are not hit by limitation, show cause notices may be got issued afresh by jurisdictional Commissionerates in supersession of the earlier show cause notices and in the light of the Hon‟ble Supreme Court judgment in the matter. 3. As for the cases which would be hit by limitation if notices are issued afresh now, necessary legal options are being explored. 4. Difficulty faced, if any, may be brought to notice of the Board.”

Section 28 amended by Finance Act 2011 23. On 8th April 2011, the Finance Act, 2011 was notified in the Official Gazette. It proposed to make series of amendments to the Act one of which was recasting of Section 28 of the Act. Clause 42 of the Finance Act stipulated that for the earlier Section 28 of the Act the following sections would be substituted:

W.P. (C) 441/2013 & connected matters

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(a) the proper officer shall, within one year from the relevant date, serve notice on the person chargeable with the duty or interest which has not been so levied or which has been short-levied or short-paid or to whom the refund has erroneously been made, requiring him to show cause why he should not pay the amount specified in the notice;

(b) the person chargeable with the duty or interest, may pay before service of notice under clause (a) on the basis of,-

(i) his own ascertainment of such duty; or (ii) the duty ascertained by the proper officer,

the amount of duty along with the interest payable thereon under section 28AA or the amount of interest which has not been so paid or part-paid.

(2) The person who has paid the duty along with interest or amount of interest under clause (b) of sub-section (1) shall inform the proper officer of such payment in writing, who, on receipt of such information shall not serve any notice under clause (a) of that sub-section in respect of the duty or interest so paid or any penalty leviable under the provisions of this Act or the rules made thereunder in respect of such duty or interest.

(3) Where the proper officer is of the opinion that the amount paid under clause (b) of sub-section (1) falls short of the amount actually payable, then, he shall proceed to issue the notice as provided for in clause (a) of that sub-section in respect of such amount which falls short of the amount actually payable in the manner specified under that sub-section

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and the period of one year shall be computed from the date of receipt of information under sub-section (2).

(4) Where any duty has not been levied or has been short- levied or erroneously refunded, or interest payable has not been paid, part-paid or erroneously refunded, by reason of,- (a) collusion; or (b) any wilful mis-statement; or (c) suppression of facts,

by the importer or the exporter or the agent or employee of the importer or exporter, the proper officer shall, within five years from the relevant date, serve notice on the person chargeable with duty or interest which has not been so levied or which has been so short-levied or short-paid or to whom the refund has erroneously been made, requiring him to show cause why he should not pay the amount specified in the notice.

(5) Where any duty has not been levied or has been short- levied or the interest has not been charged or has been part- paid or the duty or interest has been erroneously refunded by reason of collusion or any wilful mis-statement or suppression of facts by the importer or the exporter or the agent or the employee of the importer or the exporter, to whom a notice has been served under sub- section (4) by the proper officer, such person may pay the duty in full or in part, as may be accepted by him, and the interest payable thereon under section 28AA and the penalty equal to twenty- five per cent. of the duty specified in the notice or the duty so accepted by that person, within thirty days of the receipt of the notice and inform the proper officer of such payment in writing.

(6) Where the importer or the exporter or the agent or the employee of the importer or the exporter, as the case may be, has paid duty with interest and penalty under sub-section (5), the proper officer shall determine the amount of duty or interest and on determination, if the proper officer is of the opinion-

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(i) that the duty with interest and penalty has been paid in full, then, the proceedings in respect of such person or other persons to whom the notice is served under sub-section (1) or sub- section (4), shall, without prejudice to the provisions of sections 135, 135A and 140 be deemed to be conclusive as to the matters stated therein; or

(ii) that the duty with interest and penalty that has been paid falls short of the amount actually payable, then the proper officer shall proceed to issue the notice as provided for in clause (a) of sub-section (1) in respect of such amount which falls short of the amount actually payable in the manner specified under that sub-section and the period of one year shall be computed from the date of receipt of information under sub-section (5).

(7) In computing the period of one year referred to in clause (a) of sub-section (1) or five years referred to in sub-section (4), the period during which there was any stay by an order of a court or tribunal in respect of payment of such duty or interest shall be excluded.

(8) The proper officer shall, after allowing the concerned person an opportunity of being heard and after considering the representation, if any, made by such person, determine the amount of duty or interest due from such person not being in excess of the amount specified in the notice.

(9) The proper officer shall determine the amount of duty or interest under sub-section (8),- (a) within six months from the date of notice in respect of cases falling under clause (a) of sub- section (1); (b) within one year from the date of notice in respect of cases falling under sub-section (4).

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(10) Where an order determining the duty is passed by the proper officer under this section, the person liable to pay the said duty shall pay the amount so determined along with the interest due on such amount whether or not the amount of interest is specified separately.

Explanation 1 -- For the purposes of this section, "relevant date" means,- (a) in a case where duty is not levied, or interest is not charged, the date on which the proper officer makes an order for the clearance of goods;

(b) in a case where duty is provisionally assessed under section 18, the date of adjustment of duty after the final assessment thereof;

(c) in a case where duty or interest has been erroneously refunded, the date of refund;

(d) in any other case, the date of payment of duty or interest.

Explanation 2. - For the removal of doubts, it is hereby declared that any non-levy, short-levy or erroneous refund before the date on which the Finance Bill, 2011 receives the assent of the President, shall continue to be governed by the provisions of Section 28 as it stood immediately before the date on which such assent is received.”

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statement or suppression of facts” reopening has to be done within one year from the „relevant date‟. Where it falls within the categories demarcated in terms of Section 28 (4) as amended, the time period is „five years‟.

The 6th July 2011 Notification 26. On 6th July 2011 itself, Notification No. 44 of 2011-Customs was issued which purportedly designates „proper officer‟ for the purpose of Sections 17 and 28 of the Act. The said notification reads as under:

“In Exercise or the powers conferred by sub-Section (34 of Section 2 of the Customs Act, 1962 (52 of 1962), the Central Board of Excise and Customs hereby assigns the functions of the proper officer to the following officers mentioned in column (2) of the Table below, for the purposes of Section 17 and 28 of the said Act, namely:

Table Sl.No. Designation of the officers

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(1) (2) 1. Additional Director Generals, Additional Directors or Joint Directors, Deputy Directors or Assistant Directors in the Directorate General of Revenue Intelligence. 2. Commissioners of Customs (Preventive), Additional Commissioners or Joint Commissioners of Customs (Preventive), Deputy Commissioners or Assistant Commissioners of Customs (Preventive). 3. Additional Director Generals, Additional Directors or Joint Directors, Deputy Directors or Assistant Directors in the Directorate General of Central Excise Intelligence. 4. Commissioners of Central Excise, Additional Commissioners or Joint Commissioners of Central Excise, Deputy Commissioners or Assistant Commissioners of Central Excise.

The Validation Act 2011 27. The above Notification did not clarify the status of SCNs already issued prior to 6th July 2011. On 2nd August 2011 the Customs (Amendment and Validation), Act, 2011 was introduced in Parliament proposing to add another sub-section 11 after sub-section 10 of Section 28 of the Act.

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Hon‟ble Supreme Court of India in Commissioner of Customs versus Sayed Ali and Anr. (Civil Appeal Nos. 4294-4295 of 2002) held that only a customs officer who has been specifically assigned the duties of assessment and re-assessment in the jurisdiction area is competent to issue a notice for the demand of duty as a proper officer. As such the Commissioner of Customs (Preventive) who has not been assigned the function of a “proper officer” for the purposes of assessment or re-assessment of duty and issue of show cause Notice to demand Customs duty under Section 17 read with Section 28 of the Act in respect of goods entered for home consumption is not competent to function as a proper officer which has not been the legislative intent.

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The Circular dated 23rd September 2011 31. Soon after the above insertion of Section 28 (11), another Circular was issued on 23rd September 2011 withdrawing the earlier instructions dated 15th April 2011 with immediate effect. According to the said Circular, Notification No. 44/2011-Customs (N.T.) dated 6th July 2011 whereby the officers of the DRI, DGCEI, Commissionerate of Customs (Preventive) and Central Excise Commissionerates were assigned the functions of the „proper officer‟ and the amendment to Section 28 of the Act settled the issue of validity of SCNs issued by them. The only additional clarification was that the said officers would not exercise

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authority in terms of Section 28 (8) of the Act. It was clarified that “in other words, there shall be no change in the present practice and officers of DRI and DGCEI shall not adjudicate the Show Cause Notices issued under Section 28 of the said Act.”

Petitions in this Court 32. Two things happened after the issuance of the above instructions. One was that the adjudication proceedings in terms of the SCNs already issued prior to 6th July 2011, even by the DRI, and DGCEI continued on the strength of the above amendment. Consequently, as in the case of Sony India Private Limited [Writ Petition (Civil) No. 8196 of 2013], for instance, an SCN came to be issued on 12th/15th April 2013 by the DRI in respect of the period even prior to 6th July 2011, i.e., from 1st April 2008 onwards. In Writ Petition (Civil) No. 441 of 2013 (Mangali Impex Limited) the Court passed the following order on 28th January 2013:

“The main issue sought to be raised in this writ petition is that the show cause notice dated 31st October 2003 issued under Section 28 of the Customs Act, 1962 has been issued by the Assistant Commissioner of Customs (SIIB), Special Intelligence & Investigation Branch who, according to the Petitioner, was not the proper officer in terms of the said Act and in particular the provisions of Section 2 (34) of the said Act. It has also been contended by the learned counsel for the Petitioner that Explanation 2 after sub-section 11 of Section 28 of the said Act makes it clear that the provisions of the said sub-section would be applicable only on and from the date the Finance Bill, 2011 received the assent of the President and that insofar as show cause notices issued prior to that date are concerned, the provisions of Section 28 as they stood immediately before that date would continue to operate. In the present case, the show cause notice was issued way back in 2003, at which point of time sub-section (11) of Section 28 was not in the statute book.

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There is some confusion to when Explanation 2 was introduced in the statute book and as to whether Explanation 2 has at all been passed by Parliament or not. The learned counsel for the Respondents wishes to take instructions in this regard. Renotify on 4th February 2013.”

“We notice that sub-section (11) of Section 28 of the Customs Act, 1962 was introduced through the Customs (Amendment and Validation) Act, 2011 on 16th September 2011. Previously, the provisions of Section 28, which were introduced by the Finance Act, 2011, which came into effect on 1st April 2011, did not contain sub-section (11). However, it did contain Explanation 2 after sub-section (10) of Section 28 of the said Act. Prima facie, there appears to be an apparent conflict between Explanation 2 and sub-section (11) which was introduced subsequently. The conflict arises because sub- section (11) is a non-obstante provision, but is non-obstante in relation to any judgment, decree or order of any court of law, tribunal or other authority and not in relation to the other provisions of the Act which includes Explanation 2 of Section 28 which had come into force earlier. It is for this reason that we are issuing notice.

Notice is accepted by the learned counsel appearing for Respondent No. 2. Notice is also accepted by the learned counsel appearing for Respondent No. 1. Notice shall be sent to Respondent Nos. 3 and 4. The counter affidavits be filed within four weeks and rejoinder affidavits, if any, be filed within two weeks thereafter.

List on 9th April 2013.

In the meanwhile, the proceedings may go on and the adjudication order may be passed by the adjudicating

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authority. However, that order shall not be given effect to until further directions from this Court.”

Submissions of counsel for the Petitioners 36. The submissions on behalf of the Petitioners could be summarized as under: (i) The amendment by which Section 28 (11) of the Act was introduced does not cure the defects pointed out in Sayed Ali (supra). Relying on the decisions of the Supreme Court in Delhi Cloth & General Mills Co. Limited v. State of Rajasthan (1996) 2 SCC 449 and State of Haryana v. Karnal Co-op Farmers Society Limited 1993 (2) SCC 363, it was submitted that Section 28 of the Act confers such powers of the proper officer to multiple sets of customs officers without any territorial or pecuniary jurisdictional limit and for which reason the “utter chaos and confusion” envisaged by the Supreme Court in Sayed Ali (supra) would still subsist. It was further submitted that the legislature, through its validating provision, has conferred arbitrary and unguided powers which cannot be conferred on a large number of custom officers without any

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limit.

(ii) In the absence of any guidelines on how to exercise such power, it can become arbitrary and would be in violation of Article 14 of the Constitution. Reliance was placed on the decisions in State of Punjab v. Khan Chand (1974) 1 SCC 549 and Air India v. Nergesh Meerza (1981) 4 SCC 335 and also to the decision of the Andhra Pradesh High Court in Sri Balaji Rice Company v. CTO (1984) 55 SCT 292 (AP) and Kerala High Court in Sivaramakrishnan v. State of Kerala 1995 (1) ILR 92 (Ker) .

(iii) Section 28 (11) would be applicable only in respect of short-levy or non-levy or erroneous refund arising on or after 8th April 2011. It is submitted that the new Section 28 substitutes the previous Section 28 of the Act with effect from 8th April 2011. Therefore, Section 28 (11) would also be taken to have been inserted with effect from 8th April 2011. The newly inserted Section 28 (11) provides that all officers of customs prior to 6th July 2011 shall be deemed to have been and always had been proper officers for the purposes of „this section‟. It is further submitted that the phrase „this section‟ in Section 28 (11) refers to the new Section (inserted with effect from 8th April 2011) and not to the old Section 28, as it existed prior to 8th April 2011. Explanation 2 to Section 28 provides that any non-levy or short-levy prior to 8th April 2011 would continue to be governed by the provisions of Section 28 as it stood immediately prior to 8th April 2011.

(iv) Mere deeming of all the officers of the customs to be „prior officers‟ without validating the SCNs issued prior to 8th April 2011 would not validate such SCNs by merely the amending Section 28 of the Act.

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Relying on the decision of the Supreme Court in Satchidananda Misra v. State of Orissa 2004 8 SCC 599, it was submitted that the very purpose of a Validating Act is to remove the cause of ineffectiveness or invalidity. However, there is no specific provision in the Customs (Amendment and Validation) Act, 2011 which validates the past actions/SCNs.

(v) The impugned SCNs purport to empower the DRI, DGCEI to issue SCNs even for the period prior to 8th April 2011 and therefore, those SCNs were without jurisdiction and void ab initio. Section 28 of the Act confers authority on „the proper officer‟ and not „a proper officer‟ or „any proper officer‟. Relying on the decisions in Consolidated Coffee Limited v. Coffee Board (1980) 3 SCC 358 and Shri Ishar Alloys Steels Limited v. Jayaswals Neco Limited (2001) 3 SCC 609, it was submitted that the use of the definite article „the‟ is very significant as opposed to „an‟ or „any‟. Only those officers who have been assigned the functions of „the proper officer‟ for the purposes of Section 17 (Assessment of bill of entry) will be considered as „the‟ proper officer for Section 28 of the Act.

(vi) Without prejudice to the above submissions, it was contended that once a particular officer exercises jurisdiction, it would exclude the jurisdiction of all the other officers. Reliance was placed on the decisions in India Household and Healthcare Limited v. LG Household and Healthcare Limited (2007) 5 SCC 510 and Kenapo Textiles Pvt. Ltd. v. State of Haryana (1992) 84 STC 88 (P&H).

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Submissions of counsel for the Respondents 37. On behalf of the Respondents, it was pointed out that with the Bombay High Court in Sunil Gupta v. Union of India 2015 (315) ELT 167 (Bom.) upholding the constitutional validity of Section 28 (11) of the Act and accepting the plea of the Department that by virtue of insertion of Section 28 (11), the SCNs issued prior to 8th April 2011 by the DRI, the notices issued by officers of the DRI, the DGCEI etc., i.e., officers who may not have been expressly assigned the functions of „proper officers‟ under Section 2 (34) of the Act, stood validated. It was submitted that although the said decision is a subject matter of a Special Leave Petition (Civil) in the Supreme Court, this Court should nevertheless follow the decision of the Bombay High Court.

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issuing and adjudication of SCNs under Section 28 of the Act usually is undertaken by the jurisdictional Customs officer.

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v. Narayanan Nair (1994) 2 SCC 14.

Analysis of Section 28 (11) of the Act 43. The first issue is to be considered whether Section 28 (11) cures the defects pointed out by the Supreme Court in Sayed Ali (supra). In examining this issue, the Court would like to examine whether the decision of the Division Bench of the Bombay High Court in Sunil Gupta (supra) is required to be followed by the Court.

(11) of the Act which seeks to deal with the very same period, i.e., the period prior to the date on which the Finance Act, 2011 receives the assent of the President i.e., 8th April 2011. Although what is intended to be done by the legislature, as is evident from the SOR appended to the Validation Act, 2011, is to validate the notices issued prior to 8th April 2011, the opening words of sub-section (11) of Section 28 is a non-

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obstante clause only in a limited sphere. It makes sub-section (11) apply notwithstanding anything contained in any " judgment, decree or order of the Court". It does not make it apply notwithstanding anything contained elsewhere in the same statute or in any other law for the time being in force.

(11) neither explicitly or implicitly seeks to overcome the legal position brought about by Explanation 2 which states that non-levy, short-levy or erroneous refunded prior to 8th April 2011 will continue to be governed by the unamended Section 28 of the Act as it stood prior to 8th April 2011, notwithstanding enactment of Section 28 (11) of the Act. Considering that Explanation 2 opens the words „For the removal of doubts‟ the Court cannot presume a legislative intent to the contrary.

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The judgment of the Bombay High Court 48. In Sunil Gupta v. Union of India (supra) the Petitioner was served with an SCN dated 5th February 2009 by the DRI on the ground that the electronic goods imported had been mis-declared. The challenge to the SCN and the consequent adjudication was on the basis that the DRI was not competent to issue the notice. A reference was made to an earlier Notification No. 19/90-Cus. (NT) dated 26th April 1990 which dealt with appointment of officials of the DRI as Customs Officers for the area mentioned in column 1 of the Notification which referred to the different states in India or to the whole of India. On the basis of the above

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Notification and the subsequent Notification dated 6th July 2011, the Bombay High Court negatived the plea that the Central Government and the CBEC have not “entrusted or assigned the functions of the proper officer to the Additional Director of DRI”. It held that the Notification dated 6th July 2011 refers to Section 17 and 28 of the Act and therefore there was no force in the argument that DRI was not competent to issue the SCN.

The concept of a 'proper officer' 51. It was urged by Mr. Dubey that while Section 28(11) talks of the officers who are competent to deal with the questions of the powers of assessment under Section 17, Explanation 2 to Section 28 did not. It

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merely talks about the subject matter namely non-levy, short levy or erroneous refund. According to him, for determining which officer is competent to undertake the exercise in such a situation, reference has to be made necessarily only to Section 28(11) which opens with a non- obstante clause. It talks of persons appointed as Customs Officers even prior to 6th July 2011. Therefore, even the issue of non-levy, short levy or erroneous refund which arose prior to 8th April 2011 would be governed by Section 28 of the Act as it stood prior to that date. It would not affect the competence of the officers of the DRI or the DGCEI whose competence has been recognised by Section 28(11) of the Act. According to him, therefore, the two provisions were reconcilable.

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reassessment” even if it is taken that because the power of assessment under Section 17 has been mentioned there should have been a „deemed assignment of that power. Clearly, such power of assessment has to be in relation to a territorial or pecuniary jurisdictional limit.

The scope of the Validation Act 54. In this context a brief discussion of what a validation legislation is expected to do is required to be examined. It is perfectly possible and valid for the legislature to remove the defect pointed out by the Court which examines and pronounces on the constitutional validity of a statute. In The Assistant Commissioner of Urban Land Tax v. The Buckingham and Carnatic Co. Ltd. 1969 (2) SCC 55, a Constitution Bench of the Supreme Court explained that in order to remove the defects pointed out, the legislature can make what has been called „small repairs‟. The Court pointed out that giving retrospective effect to such curing of the defect “outweighs the individual‟s interest in benefitting from the defect”. In that case, the imposition of tax retrospectively by enacting the Madras Urban Land Tax Act, 1966 after removing the defect pointed out while striking down an earlier version of the Act was held to be not unreasonable.

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valid or suffers from some infirmity. In case the court comes to the conclusion that the levy of tax is not valid as the legal provision enacted for this purpose does not warrant the levy of tax imposed because of some defect in phraseology or other infirmity, the Legislature quite often passes an amending and validating Act. The object of such an enactment is to remove and rectify the defect in phraseology or lacuna of other nature and also to validate the proceedings, including realisation of tax, which have taken place in pursuance of the infirmity. Such an amending and validating Act in the very nature of things has a retrospective operation. Its aim is to effectuate and carry out the object for which the earlier principal Act had been enacted. Such an amending and validating Act to make “small repairs” is a permissible mode of legislation and is frequently resorted to in fiscal enactments.”

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constitutional limitations, can legislate prospectively as well as retrospectively. This power to make retrospective legislation enables the legislature to validate prior executive and legislative Acts retrospectively after curing the defects that led to their invalidation and thus makes ineffective judgments of competent courts declaring the invalidity. It is also well settled that a validating Act may even make ineffective judgments and orders of competent courts provided it, by retrospective legislation, removes the cause of invalidity or the basis that had led to those decisions.” ... “25. ...[I]t is open to the legislature to alter the law retrospectively, provided the alteration is made in such a manner that it would no more be possible for the Court to arrive at the same verdict. In other words, the very premise of the earlier judgment should be uprooted, thereby resulting in a fundamental change of the circumstances upon which it was founded.”

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(2) The provisions of one Section of a statute cannot be used to defeat the other provisions unless the Court, in spite of its efforts, finds it impossible to effect reconciliation between them.

(3) It has to be borne in mind by all the Courts all the time that when there are two conflicting provisions in an Act, which cannot be reconciled with each other, they should be so interpreted that, is possible, effect should be given to both. This is the essence of the rule of “harmonious construction”.

(4) The Courts have also to keep in mind that an interpretation which reduces one of the provisions as a “dead letter” or “useless lumber” is not harmonious construction.

(5) To harmonise is not to destroy any statutory provision or to render it otiose”.

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casted by Act 8 of 2011 with effect from 8th April 2011 read with Section 28(11) which was introduced by the Customs (Amendment and Validation) Act, 2011 with effect from 16th September 2011, the position that emerges is as under: (i) Section 28(11) states that all persons appointed as Customs Officers prior to 6th July 2011 will be deemed to always have had the power of assessment under Section 17 and shall be deemed to always have been „proper officers‟. Further, this is notwithstanding anything to the contrary in any judgment, decree or order of any Court of law. While the said provision is intended to overcome the defect pointed out in the decision of the Supreme Court in the Sayed Ali case, Section 28(11) of the Act does not state that it would operate notwithstanding anything contained either in the Act or any other Act for the time being in force. In other words, the legislature has not made it explicit that Section 28(11) would prevail notwithstanding anything contained in Explanation 2 to Section 28 of the Act.

(ii) On the contrary, Explanation 2 which, as it presently stands, appears after Section 28(11) of the Act as already stood enacted with effect from 8th April 2011 opens with the words „for the removal of doubts‟. It is made clear that non-levy, short-levy or erroneous refund prior to 8th April 2011 would be governed by Section 28 “as it stood immediately before the date on which such assent is received”.

(iii) Section 28(11), as it presently stands, was not in the statute book prior to 8th April 2011. Therefore, no reference can be made to Section 28(11) of the Act for determining not only the procedure

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but the very basis on which a non-levy, short-levy or erroneous refund occurring prior to 8th April 2011 should be dealt with.

(iv) Prior to 8th April 2011 and even subsequent thereto, only a „proper officer‟ who has been „assigned‟ specific functions by the CBEC or the Commissioner as amended by Section 2(34) of the Act could undertake the task of non-levy, short-levy or erroneous refund. Therefore, for any non-levy, short-levy or erroneous refund prior to 8th April 2011, an officer of the Customs who has not been specifically assigned such function in terms of the Act cannot exercise such power.

(v) Section 28(11) therefore, does not validate the show cause notices issued by the DRI, DGCEI Officers who are not „proper officers‟ for the purposes of Section 2(34) of the Act if it amounted to undertaking any assessment or re-assessment of a non-levy, short-levy or erroneous refund prior to 8th April 2011.

(vi) It is only for a period between 8th April 2011 and 6th July 2011 that such deemed „proper officer‟ can be said to have been given retrospective power to deal with non-levy, short-levy or erroneous refund for any period subsequent to 8th April 2011, i.e., the date on which Section 28(11) read with Explanation 2 could be said to have come into force.

Section 28 (11) gives untrammelled power 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

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conflicting decisions. Such untrammelled power would indeed be arbitrary and violative of Article 14 of the Constitution.

“34. The existence of a multiplicity of officers of the same status exercising power over the same area can lead to chaos and confusion and conflicting orders. It may even lead to multiplicity of proceedings regarding the same subject matter causing hardship and inconvenience to dealers. Questions may also arise as to who should be the revisional or appellate authority in relation to a

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particular proceeding. Section 3(2) has therefore advisedly limited the area of operation of any particular officer to certain local limits, and not unlimited throughout the State. The conferment of such power throughout the State is not therefore in consonance with Section 3(2) and is ultra vires the said provision.

Effect of Section 28 (11) 66. The mere fact that Section 28(11) has been given retrospective effect does not solve the essential problem pointed out by the Supreme Court in the Sayed Ali case, which is the absence of the assigning of functions to

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„proper officers‟ under Section 2(34) of the Act. The even more serious problem is the impossibility of reconciling two contradictory provisions, viz., Explanation 2 to Section 28 and Section 28(11) of the Act.

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subject matter. The doctrine of comity of jurisdiction requires that for the proper administration of justice there should not be an overlapping of the exercise of powers and functions. The decision of the Punjab and Haryana High Court in Kenapo Textiles Pvt. Ltd. v. State of Haryana (supra) and the decision of the Supreme Court in India Household and Healthcare Ltd. v. LG Household and Healthcare Ltd. (supra) are relevant in this context.

Conclusion on the effect and validity of Section 28 (11) 70.1 The net result of the above discussion 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 period subsequent to 8th April 2011, it is evident that if the administrative chaos as envisaged by the Supreme Court in Sayed

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Ali (supra) should not come about, there cannot be any duplicating and/or overlapping of jurisdiction of the officers. It would have to be ensured through proper co-ordination and administrative instructions issued by the CBEC that once a SCN is issued specifying the adjudicating officer to whom it is answerable, then that adjudication officer, subject to such officer being a 'proper officer' to whom the function of assessment has been assigned in terms of Section 2 (34) of the Act, will alone proceed to adjudicate the SCN to the exclusion of all other officers who may have the power in relation to that subject matter.

70.4 The question as to the constitutional validity and effect of Section 28 (11) of the Act is answered accordingly.

Sony India Pvt. Ltd. 72. Writ Petition (C) No. 8196/2013 by Sony India Private Limited is against ten SCNs issued by the Additional Director General, DRI, Bangalore on 12th and 15th April 2013 in respect of alleged non-levy, short-levy or erroneous refund for period beginning with 1st April 2008 and bearing the following numbers: DRI F.No.S/IV/32/2011/NDLS, DRI F.No.S/IV/32/2011/Nhava Sheva, DRI F.No.S/IV/32/2011/ACC Mumbai, DRI F.No.S/IV/32/2011/ACC Chennai, DRI F.No.S/IV/32/2011/Chennai Sea, DRI F.No.S/IV/32/2011/ACC Kolkata, DRI F.No.S/IV/32/2011/Kolkata Sea, DRI F.No.S/IV/32/2011/Kochi, DRI F.No.S/IV/32/2011/Dadri and DRI F.No.S/IV/32/2011/ACC B'lore.

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Chennai, Kolkata and Bengal. This also included the ports at Nhava Sheva, the Chennai sea port, the sea port at Kolkata and ICD at Dadri. Subsequently however a common adjudicating authority was appointed viz., the Commissionerate of Customs (Imports), New Delhi.

Mangali Impex Ltd. 77. The prayer in W.P. (C) No. 441 of 2013 by Mangali Impex Ltd. is for quashing of the SCN dated 31st October 2003 issued under Section 28/124 of the Act.

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the Petitioner as well as J.K. Impex between November 1998 and January 1999. The Special Intelligence and Investigation Branch („SIIB‟), which is a unit of the Customs Department, raided the premises of the Petitioner and the residence of its Director on 9th August 2000 on the basis that the export consignment was of Calcium Carbonate and not Calcium Stearate. The Director of the Petitioner was taken into custody and series of investigations and criminal cases ensued. Later on 3rd February 2006, a closure report filed by the Central Bureau of Investigation („CBI‟) was accepted by the concerned Court.

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M/s. Lakshman Overseas

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2010, and SCN dated 12th February 2013 and all proceedings consequent thereto. Writ Petition (C) No. 1185/2013 and the pending application, if any, are disposed of in the above terms.

Pace International 90. The challenge in Writ Petition (C) No. 7383/2013 by Pace International is to a SCN dated 9th March 2011 issued by the Commissioner of Customs (Preventive) to the Petitioner pursuant to the putting on hold various consignments of woollen carpets sought to be exported by the Petitioner on 10th November 2010 at the ICD, Patparganj, New Delhi. The challenge is also to the Circular dated 29th September 2011 issued pursuant to the insertion of sub-section 11 to Section 28.

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judgment, it is clear that in relation to the events that took place prior to 8th April 2011 no SCN could have been issued to the Petitioner by the Commissioner of Customs (Preventive) who admittedly is not a „proper officer‟ in terms of the Section 2(34) of the Act. Section 28(11) of the Act cannot be resorted to for validating the said SCN and proceedings pursuant thereto.

K.S. Traders 97. The challenge in Writ Petition (C) No. 211/2014 by M/s. K.S. Traders is to a SCN dated 30th January 2004 issued by the ADG, DRI to the Petitioner alleging over invoicing and recovery of draw back under Rules 16 and 16-A of the Customs & Central Excise Duty Draw Back Rules, 1995 read with Sections 75(1), 76(1) (b) and 75-A(2) of the Act.

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Bharat Sanchar Nigam Limited 100. The challenge in Writ Petition (C) No. 225/2014 by Bharat Sanchar Nigam Ltd. (BSNL) is to a SCN dated 3rd April 2013 issued by the DRI, Delhi to BSNL as well as an order dated 23rd May 2013 passed by the Central Board of Excise and Customs (CBEC) under Section 4 of the Act assigning several cases including the case on hand to the Commissioner of Customs (Import & General) for the purposes of adjudication under Section 4 of the Act and consequent order dated 16th December 2013 passed by the Commissioner of Customs (Import & General).

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in favour of the DRI in so far as it pertains to events that occurred prior to 8th April 2011.

Sennheiser Electronics India Pvt. Ltd. 107. The SCN under challenge in Writ Petition (C) No. 863/2014 by Sennheiser Electronics India Pvt. Ltd. is dated 24th December 2011 and was issued by the ADG, DRI in relation to alleged short levy of customs duty for the period 28th January 2011 to 28th February 2013.

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Comet Impex 110. The challenge in Writ Petition (C) No. 3803/2014 by M/s. Comet Impex is to an impugned SCN dated 31st October 2008 issued by the ADG, DRI, Delhi to the Petitioner in relation to reassessment of imported goods during the period prior to 8th April 2011. The challenge is also to the impugned Circular No. 44/2011-Cus dated 23rd September 2011 issued consequent upon the insertion of Section 28(11) of the Act.

Rajesh Gupta 114. The challenge in Writ Petition (C) No. 5262/2014 by Rajesh Gupta is to the SCN dated 14th March 2011 issued by the ADG, DRI in relation to alleged imports made through the ICD, Tughlakabad during the period prior thereto.

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the acts and the SCN issued by the ADG, DRI. Since it pertains to a period prior to 8th April 2011 it is governed entirely by Section 28 as it originally stood, i.e., prior to 8th April 2011.

Daikin Airconditioning India Private Ltd. 118. The challenge in Writ Petition (C) No. 5877/2014 by Daikin Airconditioning India Pvt. Ltd. is to one consolidated SCN dated 29th May 2014 was issued to the Petitioner for alleged short levy during the period 27th May 2009 to July 2013.

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Godrej and Boyce Manufacturing Co. Ltd. 122. The prayer in Writ Petition (C) No. 4162/2015 filed by Godrej and Boyce Manufacturing Co. Ltd. is inter alia to the SCN dated 2nd April 2009 issued by the DRI and for declaring Section 28(11) of the Act to be constitutionally invalid. Reference is made to the decision of the Supreme Court in Sayed Ali (supra).

Satyam Marketing Through: Its Proprietor 125. The challenge in Writ Petition (C) No. 4841/2015 by M/s. Satyam Marketing is to an SCN dated 2nd December 2013 issued by the ADG, DRI to the Petitioner in relation to 190 bills of entry for the period prior to 8th April 2011. A list of the bills of entry for the period prior to 8th April 2011 has been appended to as Annexure B to the SCN. The ADG, DRI who issued the SCN was admittedly not a „proper officer‟ for the purposes of Section 2(34) of the Act.

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Manoj Saboo @ Manoj Maheshwari 128. In light of the decision in Satyam Marketing v. Union of India (W.P. (C) No. 4841/2015), the SCN dated 2nd December 2013 issued by the ADG, DRI to the Petitioner Manoj Saboo and all proceedings pursuant thereto, which have been challenged in the present Writ Petition (C) No. 5191/2015 are hereby quashed to the extent they pertain to the period prior to 8th April 2011. The proceedings for the subsequent period may go on in accordance with law.

Hansraj Bhatia & Co. through its Proprietor Shri Sanjeev Bhatia 130. The challenge in Writ Petition (C) No. 9379/2015 by Hansraj Bhatia & Co. is to the SCN dated 12th March 2014 issued by the ADG, DRI in relation to imports made for the period 24th June 2009 to 8th April 2011. While 8 bills of entry pertain to ICD, Tughlakabad, 6 pertain to Mumbai Port and 2 pertain to ICD, Mulund in Bombay.

M/s. J. R. International

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Cortel India 136. The challenge in this Writ Petition (C) No. 11285/2015 by Cortel India is to a SCN dated 9th June 2014 issued by the ADG, DRI invoking Section 124 of the Act and Section 28 read with Section 9A of the Customs Tariff Act, 1975 in relation to the imports of Color Picture Tubes made through the ICD, Tughlakabad as well as ICD, Dadri for the period May 2009 to January 2011.

Bhagwati Components Manufacturing Co. through its Director Mr. Surjit Singh 139. The challenge in this Writ Petition (C) No. 11806/2015 by Bhagwati

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Components Manufacturing Co. is to an SCN dated 10th September 2004 issued by the ADG, DRI in relation to the alleged mis-declaration of value of export of Alloy Steel Forgings (Machined) from ICD, Tughlakabad and CFS, Patparganj by the Petitioner for the purpose of availing higher DEPB credit for the period prior to 8th April 2011; Adjudication Order dated 18th December 2009 passed by Commissioner of Customs (Adjudication) and order dated 4th September 2015 by the CESTAT consequent thereto.

Eastron Overseas Inc. 142. The challenge in this Writ Petition (C) No. 11853/2015 by Eastron Overseas Inc. is to a SCN bearing F. No. 23/17/2011-DZU(Eastron)/5951 (Show cause notice No. 50/2014) dated 20th November 2014 issued by the ADG, DRI under Section 124 of the Customs Act read with Section 9A of the Customs Tariff Act, 1975 in relation to import of Color Picture Tubes in the year 2010.

Divya Electronics

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Rajesh Tripathi 148. The facts of this Writ Petition (C) No. 563/2016 are that searches were conducted in the residential premises of the Petitioner Rajesh Tripathi who is the publisher/owner/controller of Ghaziabad Samasya, Bharat Samasya and Aaj Ki Roshni all newsprint and Light Weight Coated („LCW‟) paper on 28th December 2005 on intelligence that the said parties were evading customs duty by allegedly mis-declaring and undervaluing the import in connivance with the various Registrars of Newspapers in India. Consequent thereto, a SCN bearing DRI F No. 23/118/2005-DZU-Ghaziabad Samasya was issued on 17th December 2007 by the DRI to be adjudicated by the Commissioner of Customs. This resulted in an adjudication order passed by the Commissioner of Customs confirming the demand. The appeal filed before the CESTAT against the said order is still pending and the CESTAT has required the Petitioner to deposit the 10% duty amount as a pre-deposit.

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of issuance of the said SCN had not been assigned functions by the CBEC of assessment or reassessment and, therefore, is not a „proper officer‟ under Section 2(34) of the Act. The impugned SCN and all proceedings consequent thereto are hereby stand quashed.

S.MURALIDHAR, J

VIBHU BAKHRU, J MAY 3, 2016 Rm