Proper officer jurisdiction in customs assessment must be established before adjudication can stand.

Finalisation of provisional assessment and re-assessment under the Customs Act depends on action by the proper officer under section 2(34), and jurisdiction to sustain the adjudication must be clear from the record. Where the proceedings originated from a show cause notice issued by Directorate of Revenue Intelligence officers without demonstrated competence as the proper officer, the validity of the adjudication was left in doubt. On that basis, the impugned order could not be sustained on the existing record and was set aside. The matter was remanded for fresh decision after the jurisdictional issue is first settled.

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Issues: Whether the adjudication and finalisation of assessment were vitiated for want of jurisdiction because the show cause notice was issued by officers of the Directorate of Revenue Intelligence who were not shown to be the proper officer competent to undertake finalisation of assessment and re-assessment under the Customs Act, 1962.

Analysis: Finalisation of provisional assessment and re-assessment under sections 17 and 18 of the Customs Act, 1962 lies within the exclusive competence of the proper officer as defined in section 2(34) of the Customs Act, 1962. The impugned proceedings traced their origin to a notice issued by the Directorate of Revenue Intelligence, and the controversy turned on whether such notice could validly sustain the adjudication. The reasoning proceeded on the basis that competence to issue the notice was foundational, and that when jurisdiction itself is in doubt, the resulting order should not be allowed to stand until the jurisdictional question is resolved. In that setting, the impugned order was held not to be capable of being sustained on the existing record.

Conclusion: The impugned order was set aside and the matter was remanded for fresh decision after the jurisdictional issue is settled.

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