2019 (6) TMI 806 - HC - Customs

Court upholds Customs confiscation order, highlights appeal remedy. Petitions dismissed, Circular challenge rejected.

The High Court dismissed three petitions challenging the order of the Additional Commissioner of Customs confiscating gold bars and imposing penalties ... Jurisdiction of adjudicating authority under the Customs Act - availability of alternative remedy of appeal to Commissioner (Appeals) - non-application of Central Excise adjudication monetary limits to Customs Act proceedings - exercise of writ jurisdiction in presence of efficacious alternate remedy - pre-deposit requirement under Section 129ENon-application of Central Excise adjudication monetary limits to Customs Act proceedings - jurisdiction of adjudicating authority under the Customs Act - Whether the Board's Master Circular on adjudication monetary limits for Central Excise and Service Tax (Circular No.1053) restricts the Additional Commissioner of Customs' power to adjudicate demands under the Customs Act. - HELD THAT: - The Court held that the monetary limits set out in the cited Master Circular apply to adjudication proceedings under the Central Excise Act, 1944 and the Finance Act, 1994 (Service Tax) and have no application to proceedings under the Customs Act. Consequently, the impugned order passed by the Additional Commissioner of Customs under the Customs Act could not be impugned as being without jurisdiction on the ground of the Circular's monetary limits. The Court therefore rejected the submission that the Additional Commissioner lacked jurisdiction to adjudicate the demand by reason of the Board's circular. [Paras 5]Circular No.1053's monetary limits do not apply to adjudication under the Customs Act; the Additional Commissioner was not shown to be without jurisdiction on that basis.Availability of alternative remedy of appeal to Commissioner (Appeals) - exercise of writ jurisdiction in presence of efficacious alternate remedy - Whether the writ petitions should be entertained despite an alternative statutory remedy of appeal to the Commissioner (Appeals). - HELD THAT: - The Court found that an efficacious alternative remedy in the form of an appeal to the Commissioner (Appeals) is available against the impugned adjudication order and that the petitioners' grievances on merits, including allegations such as non-grant of cross-examination, could and should be addressed in that appellate forum. In light of the availability of that remedy, the Court declined to exercise its extraordinary writ jurisdiction to entertain the petitions. The Court nevertheless directed that if an appeal is filed within three weeks, the Commissioner (Appeals) shall entertain it on merits and exclude the time consumed in prosecuting these writ petitions when considering limitation, following the principle in the cited Apex Court decision. [Paras 3, 6, 7]Writ petitions dismissed for want of alternative remedy; appeal to Commissioner (Appeals) is the appropriate forum and, if filed within three weeks, must be entertained with time spent in these proceedings excluded.Pre-deposit requirement under Section 129E - Whether the petitioners are required to comply with statutory pre-deposit requirements while filing an appeal to the Commissioner (Appeals). - HELD THAT: - The Court made clear that, notwithstanding its directions on condonation of time, the petitioners remain bound to satisfy the statutory conditions for filing an appeal, including the requirement of making any prescribed pre-deposit in accordance with the Customs Act. The Court therefore did not waive or alter statutory pre-conditions for maintainability of the appeal. [Paras 8]Petitioners must comply with statutory requirements, including any pre-deposit under Section 129E, when preferring the appeal.Final Conclusion: The writ petitions challenging the confiscation and penalties were dismissed because an efficacious alternative remedy by way of appeal to the Commissioner (Appeals) is available; the Board's Central Excise adjudication monetary limits do not restrict adjudication under the Customs Act; the Commissioner (Appeals) shall entertain an appeal filed within three weeks and exclude time spent in these proceedings, subject to the petitioners satisfying statutory requirements including the prescribed pre-deposit. Issues:Challenging order of Additional Commissioner of Customs, confiscation of gold bars, imposition of penalties under Customs Act, jurisdiction of High Court to entertain petition challenging order, alternative remedy of appeal before Commissioner of Customs (Appeals), applicability of Circular on monetary limits for adjudication proceedings.Analysis:1. The judgment involves three petitions challenging a common order dated 9th May, 2017 by the Additional Commissioner of Customs, Preventive Mumbai. The order confiscated gold bars valued at Rs. 3.17 crores and imposed penalties under Sections 111(b)(d)(l) and 112(a)(b) of the Customs Act, 1962. The petitioners argued that the order was without jurisdiction, citing Circular No. 1053 which sets monetary limits for adjudication proceedings.2. The petitioners contended that the Circular's monetary limits apply only to proceedings under the Central Excise Act, 1944 and the Finance Act, 1994, not the Customs Act. Therefore, they argued that the impugned order by the Additional Commissioner of Customs was not without jurisdiction, and the High Court should not interfere in its extraordinary jurisdiction.3. The petitioners also raised concerns about the merits of the impugned order, specifically the non-granting of cross-examination. However, the High Court held that an efficacious alternative remedy was available through an appeal to the Commissioner of Customs (Appeals), where grievances on the merits of the order could be addressed and adjudicated upon.4. The High Court dismissed the petitions but clarified that if the petitioners file an appeal before the Commissioner of Customs (Appeals) within three weeks, the appeal would be entertained on its own merits. The Court cited a Supreme Court decision to exclude the time spent on the petitions from the appeal period. The petitioners were reminded of the statutory requirements, including pre-deposit under Section 129E of the Act, for filing an appeal.5. In conclusion, the High Court disposed of the three petitions based on the above terms, emphasizing the availability of an alternative remedy through the appeal process before the Commissioner of Customs (Appeals) for addressing grievances regarding the impugned order.