2019 (7) TMI 1656 - AT - Customs

Tribunal directs review of DRI Officers' jurisdiction, emphasizing timely merit-based decisions.

The Tribunal set aside the remand order and directed the first appellate authority to decide on merits and the jurisdiction of DRI Officers following a ... Jurisdiction to issue SCN - power of DRI to issue SCN - whether the Officers of DRI, can issue show-cause notice for the period prior to 08.04.2011? - HELD THAT:- It is true that the question as to whether the Officers of DRI, can issue show-cause notice for the period prior to 08.04.2011, has been the subject matter of the orders passed by the various High Courts - In the case of M/S MANGALI IMPEX LTD., M/S PACE INTERNATIONAL AND OTHERS VERSUS UNION OF INDIA AND OTHERS [2016 (5) TMI 225 - DELHI HIGH COURT], the Hon’ble High Court of Delhi, has held that the Officers of DRI had no such power, while the Hon’ble High Court of Bombay in SUNIL GUPTA VERSUS UNION OF INDIA AND OTHERS [2014 (12) TMI 151 - BOMBAY HIGH COURT] had, on the other hand, held that the Officers of DRI had such power. The decision of the High Court of Delhi in the case of Mangali Impex Ltd., has been stayed by the Hon’ble Supreme Court. In this factual matrix, in several cases, the Tribunal had remanded such matters to the lower authority to decide the matter on merits after the decision by the Hon’ble Apex Court in the case of Mangali Impex Ltd. - Such remand orders have been challenged before the Hon’ble High Court of Delhi in the case of Commissioner of Customs Vs. Arif Khichi [2018 (6) TMI 23 - DELHI HIGH COURT] and the Hon’ble High Court has held that the decision of the Hon’ble High Court of Delhi in the case of Mangali Impex Ltd., has been stayed by the Hon’ble Apex Court and therefore, the Tribunal ought to have decided the issue on merits including the issue of jurisdiction of DRI Officer for issuance of show-cause notice and the Tribunal remanding the matter causes harassment to the assessee and inconvenience to the Department. Thus holding, the Hon’ble High Court of Delhi had directed the Tribunal to recall their appeal in that case and decide the issue on merits including the jurisdiction issue without being influenced by the aforesaid order of the Hon’ble High Court in the case of Mangali Impex Ltd. The impugned order passed by the first appellate authority remanding the matter to the lower authority is not correct and needs to be set aside - the matter has to be examined on merits by the first appellate authority as well as on the question of jurisdiction of DRI Officer to issue show-cause notice - Appeal allowed by way of remand. Issues:1. Jurisdiction of DRI to issue show-cause notices prior to 08.04.2011.2. Remand of cases by the lower appellate authority without deciding on merits.3. Conflict of decisions by different High Courts on the power of DRI Officers to issue show-cause notices.4. Applicability of judgments of High Courts and Supreme Court on remand decisions by the Tribunal.Analysis:1. The appeals filed by the Revenue were against the Order-in-Appeal remanding the matter to the original authority to decide the jurisdiction of DRI and the case on merit after granting a hearing and following natural justice principles. The respondents were importers of electrical goods suspected of under-valuation to evade duty. The original authority rejected declared values, confirmed differential duty demand, ordered confiscation, and imposed penalties.2. The first appellate authority remanded the cases without discussing merits, relying on the Delhi High Court's judgment in Mangali Impex Ltd. v. Union of India. The High Courts of Bombay and Telangana had differing views on the power of DRI Officers to issue show-cause notices. The Tribunal had previously remanded cases pending the Apex Court's decision in Mangali Impex Ltd.3. The Revenue challenged the remand, arguing the need for a merit decision. The High Court of Delhi held that the Tribunal should decide on merits, irrespective of the stay on the Mangali Impex Ltd. judgment. The Tribunal's view on remands related to pending cases before the Apex Court was overruled.4. The Tribunal set aside the remand order, directing the first appellate authority to decide on merits and the jurisdiction of DRI Officers following the Delhi High Court's decision in another case. The judgment emphasized the need to decide cases on merits without waiting for final decisions from higher courts, allowing for examination by the adjudicating authority or the Tribunal.