Current writ petition has been filed against Show Cause Notice dated April 13, 2020 (SCN) issued by the Directorate of Revenue Intelligence (“DRI”) under Section 124 read with Section 28 of the Customs Act, 1962 on the ground of lack of authority with the DRI to pass such SCN.
The Petitioners contend that the SCN issued by the DRI lacks the authority by relying on the case of M/s. Canon India Private Limited v. Commissioner of Customs [Civil Appeal No.1827 of 2018 dated March 09, 2021] wherein it was held that DRI has no authority to issue any SCN under Section 28 of the Customs Act, 1962 which provides for the powers of “Proper Officer” to issue notice for payment of duties, interest etc. in case of erroneous refund or short levy of interest on duty under the provisions of Customs Act, 1962.
In the case of M/S Canon India Private Limited (supra) the SCNs issued by the DRI were struck down for denying Basic Customs Duty (“BCD”) exemption on import of “Digital Still Image Video” cameras. By interpreting Section 28(4) the Customs Act, 1962, it was held that only a “Proper Officer” under the section can issue such a notice, thereby interpreting that the section provides the power only to the officer or his successor, who had originally been provided with the task of Assessment.
The Hon’ble Calcutta High Court noted that there appears to be a prima facie case by following the judgment of M/s. Canon India Private Limited (supra) wherein it was held DRI has no authority to issue such SCN and that such notice is non-est in law. Therefore, the stayed the SCN.
FULL TEXT OF THE JUDGMENT/ORDER OF CALCUUTA HIGH COURT
The Court : In this writ petition the writ petitioner is aggrieved by the impugned show-cause notice issued on 13th April, 2020 by the DRI under Section 124 read with Section 28 of the Customs Act, 1962. As per the judgment of the Supreme Court passed in M/s. Canon India Private Limited Versus Commissioner of Customs in Civil Appeal No.1827 of 2018, the DRI has no authority to issue any show-cause notice under Section 28 of the Customs Act, 1962. Paragraphs 18 to 23 of the judgment are relevant in this regard. In pursuance of M/s. Canon India Private Limited (supra) such show-cause notice is non-est in law and the person issuing the show-cause notice has no authority under the Customs Act to issue the said show-cause notice.
I have heard learned Counsel appearing for the parties and perused the materials on record.
In my view, there appears to be a prima facie case for staying the show cause notice following the judgment in M/s. Canon India Private Limited (supra). Accordingly, the impugned show-cause notice is stayed till 3rd January, 2022, or until further orders, whichever is earlier.
I have not gone into the merits of the other arguments raised by the learned Counsel appearing for the petitioner at this stage.
Accordingly, let affidavit-in-opposition be filed within four weeks after Puja Vacation; reply, if any, be filed within two weeks thereafter.
Learned Counsel appearing for the respondents submits that respondent no.2 has no role to play and his name should be deleted in this proceeding.
Accordingly, respondent no.2 is deleted from this proceeding.
Let the matter appear in the list on 20th December, 2021.
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