Blue Star International Pvt. Ltd. Vs Commissioner, Central Excise and Central GST (Delhi High Court)
Summary: The Delhi High Court, presided over by Justice Manmeet Pritam Singh Arora, dismissed three connected contempt petitions filed by Blue Star International Pvt. Ltd., Sunflame Trading Pvt. Ltd. and Atlantic International Trading Pvt. Ltd. against the Commissioner, Central Excise and Central GST Commissionerate, Delhi South. The petitions alleged non-compliance with directions issued by a Division Bench on 22 November 2022 in earlier writ proceedings. The petitioners complained that the respondent authorities had failed to supply duly endorsed copies of documents seized under a panchnama dated 17 September 2019, contrary to the statement made before the Division Bench. The dispute therefore concerned whether the failure to return seized documents, notwithstanding an earlier judicial direction, constituted wilful disobedience warranting contempt proceedings.
The respondent department filed a common reply dated 25 February 2023 explaining that the file containing the seized documents was untraceable. According to the department, a TRACER had been issued on 14 October 2022 to locate the file. The officer who had prepared the panchnama and was responsible for custody of the records had not handed the file over to his successor and had subsequently died during the COVID-19 pandemic. The department also stated that it was corresponding with the Directorate General of GST Intelligence (DGGI), Headquarters, which had conducted the search on 17 September 2019, but replies were awaited. On these facts, the department maintained that its inability to return the seized documents was not deliberate and requested disposal of the contempt petitions.
The petitioners argued that the department had issued the TRACER before the Division Bench passed its order dated 22 November 2022 but had not disclosed the missing-file position to that Bench. They submitted that the department should have approached the Division Bench for modification of the earlier directions instead of failing to comply. The petitioners therefore maintained that the authorities had committed contempt. The High Court examined these objections alongside the department’s explanation and the extent to which the earlier directions had been implemented.
The Court recorded that the petitioners did not dispute that the directions regarding cloning of data from digital devices seized during searches on 17 September 2020 and 24 November 2020 had already been complied with and that the cloned data had been handed over. Regarding the physical documents seized under the panchnama dated 17 September 2019, the Court accepted that the department had placed its explanation on record, including the untraceable file and the steps initiated to locate it. Having regard to those circumstances, the Court concluded that there was no wilful disobedience of the Division Bench’s directions dated 22 November 2022. All three contempt petitions were accordingly dismissed. The ruling turns on the evidence and circumstances of non-compliance before the Court; it does not establish that failure to return seized documents is automatically immune from contempt proceedings.
FULL TEXT OF THE ORDER OF DELHI HIGH COURT
1. These petitions have been filed stating that the Respondent herein has not complied with the directions issued by a Division Bench of this Court vide common order dated 22.11.2022, passed in separate writ petitions filed by the Petitioners herein.
2. The Petitioner state that the Respondent has failed to provide the duly endorsed copies of the documents seized vide panchnama dated 17.09.2019 and thereby acted in contravention of the statement made before the Division Bench on 22.11.2022.
3. Learned counsel for the Respondent has filed a common reply dated 25.02.2023 in CONT. CAS(C) 204/2023. In the said reply it is stated that the file pertaining to the documents resumed vide the aforesaid panchnama is not traceable in the office of the Respondent. He states that a TRACER was issued on 14.10.2022 to trace the file. It is further stated that the officer who had drawn the said panchnama, being the custodian of the said file, did not handover the same to his successor; further the said officer passed away during the COVID-19 pandemic. He states that the Respondents are also in correspondence DGGI (Hq.) who has searched the office of the Petitioners on 17.09.2019, however, replies are awaited.
3.1. He states that it is in these aforesaid circumstances that the Respondent has been unable to return the documents seized vide the said panchnama and there is no wilful disobedience.
3.2. He states that therefore, the present petition be disposed of taking on record the aforesaid statement with respect to documents seized vide panchnama dated 17.09.2019.
4. In rejoinder, learned counsel for the Petitioner states that in the reply it is stated that the Respondents issued a TRACER for the file on 14.10.2022, however, the said fact was not brought to the attention of the Division Bench on 22.11.2022. He states that the Respondent should have approached the Division Bench to seek modification of the said order and having failed to do so, the Respondents have committed contempt.
5. This Court has considered the submissions of the parties.
6. The Petitioner(s) does not dispute that the directions issued by the Division Bench vide order dated 22.11.2022, with respect to cloning of data from the digital devices which were seized during the searches dated 17.09.2020 and 24.11.2020 have been completed and handed over to the Petitioner(s) herein.
7. The Respondent has placed on record its stand with respect to the circumstances in which it has been unable to furnish the documents seized vide panchnama dated 17.09.2019. The Respondent has stated that the said file is untraceable and the Respondent has initiated steps for tracing the said file. In these circumstances this Court is of the opinion that there is no wilful disobedience by the Respondents of the directions issue vide order dated 22.11.2022. These petitions are accordingly dismissed.
