Customs Act Show Cause Notice Challenged for Jurisdiction and Delay; HC Stays Notice, Citing Recent SC Decision.

The Bombay HC addressed a challenge to a show cause notice under the Customs Act, 1962, issued by the Directorate of Revenue Intelligence. The petitioner argued that, based on a recent SC decision, the Directorate lacked jurisdiction to issue such notices and that delayed adjudication was illegal. The HC found merit in these arguments, stayed the show cause notice, and allowed the respondents to file a reply affidavit. The Court highlighted the importance of timely adjudication and indicated that similar orders from a previous case would be applied, pending further proceedings.

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Issues involved: Challenge to show cause notice under Customs Act, 1962; Delayed adjudication of show cause notice.

Summary:
The High Court of Bombay heard a case challenging a show cause notice issued under the Customs Act, 1962. Initially, a penalty was imposed on the petitioner, which was later set aside by the Appellate Tribunal for de novo adjudication. Despite this, no action was taken by the respondents to adjudicate the show cause notice within the specified period. The petitioner argued that a recent Supreme Court decision held that the Directorate of Revenue Intelligence lacked jurisdiction to issue such notices. The petitioner contended that delayed adjudication of the notice would be illegal, citing relevant legal precedents.

The Court considered the submissions and found merit in the petitioner's arguments. It noted that the show cause notice issued by the Directorate of Revenue Intelligence would be subject to the Supreme Court's decision regarding jurisdiction. The Court also referenced a previous case where delayed adjudication of a show cause notice was deemed illegal. Therefore, the Court decided to stay the impugned show cause notice pending further proceedings, allowing the respondents to file a reply affidavit. The Court indicated that similar orders to those in a previous case would be passed in this petition, emphasizing the need for timely resolution of the matter.

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