Customs adjudication follows the clearing port: post-import DEEC breach had to be decided by Bombay Customs, not Rajkot.

Jurisdiction to adjudicate confiscation and penalty for alleged post-import breach under the DEEC Scheme lay with the Customs officer through whose port the goods were cleared. Goods imported through Bombay were cleared by Bombay Customs on an undertaking, so any allegation that clearance conditions were violated or obtained by fraud had to be examined by that authority. Factory officers could investigate or seize the goods, but they could not assume adjudicatory jurisdiction over the customs breach. The Collector of Customs, Rajkot therefore lacked jurisdiction, and the order was set aside in favour of the assessee.

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Issues: Whether the Collector of Customs, Rajkot had jurisdiction to adjudicate confiscation and penalty proceedings in respect of imported goods cleared through Bombay Customs, where the alleged violation related to post-importation use under the DEEC Scheme.

Analysis: The goods were imported through the Port of Bombay and cleared by the Bombay Customs House on the basis of an undertaking under the DEEC Scheme. The adjudication was treated as a Customs matter arising from alleged breach of the conditions on which clearance had been granted, not as a case of non-accountal of raw materials for excise purposes. Since the clearance had been ordered by the proper officer at Bombay, any allegation that the clearance conditions were violated or obtained by fraud had to be examined by that very customs authority. The officers at the factory could investigate or seize the goods, but jurisdiction to adjudicate the alleged breach lay with the Customs officer through whose port the goods had been cleared.

Conclusion: The Collector of Customs, Rajkot lacked jurisdiction to adjudicate the matter, and the order was set aside on that ground in favour of the assessee.

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