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of <h1>DRI's Show-Cause Notice on Seized Gold Valid; Disposal Ordered Within Three Months Under Natural Justice Rules</h1> <h3>Arun Kothari Versus Union of India & Ors.</h3> Arun Kothari Versus Union of India & Ors. - 2025:BHC - AS:31804 - DB ISSUES: Whether the impugned show cause notice issued by the Directorate of Revenue Intelligence is wholly without jurisdiction and liable to be quashed at the pre-adjudication stage.Whether the seized gold can be sold or disposed of by the authorities before disposal of the show cause notice and any subsequent period.Whether delay in disposal of the show cause notice justifies judicial interference or directions for expeditious adjudication. RULINGS / HOLDINGS: The court held that the impugned show cause notice is not 'wholly without jurisdiction' and does not warrant interference at this stage, as the notice contains allegations which require adjudication and the petitioner's denial will be examined during the proceedings.The court directed that the seized gold 'must not be sold' by the respondents until the show cause notice is disposed of and for a period of six weeks thereafter in case of any adverse order against the petitioner.The court found that the delay in disposal of the show cause notice is unacceptable and accordingly directed the respondents to adjudicate and dispose of the notice 'as expeditiously as possible and in any event within three months' from the date of the order. RATIONALE: The court applied the legal framework established in Whirlpool Corporation vs Registrar Of Trade Marks, Mumbai & Ors., emphasizing that none of the tests for pre-adjudication interference were satisfied.The court recognized the importance of adhering to 'principles of natural justice' by requiring the petitioner to be heard before disposal of the show cause notice.The court balanced the need to protect the petitioner's interests by restraining disposal of seized gold pending final adjudication and any remedies post adverse orders, while also upholding the authority of the investigating agency to proceed with adjudication.No dissent or doctrinal shift was noted; the judgment follows established principles regarding jurisdictional challenges to show cause notices and interim relief concerning seized property.
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