TaxTMI 
TaxTMI 
2022 (4) TMI 436
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.... Singh, learned Senior Standing Counsels appearing for Central Goods and Service Tax/Central Excise, Kanpur. 3. The challenge raised in this writ petition is to the jurisdiction of the Commissioner, CGST and Central Excise, Kanpur, the Respondent No.4 to adjudicate the show cause notice dated 22.06.2011 issued by the Commissioner of Customs (Expert) Jawahar Lal Nehru, Customs House, Nhava Sheva, Tal Vran, District Raigarh, Maharashtra, Respondent No.2, under the Customs Act, 1962. The challenge is based on the premise that the Respondent No.4 is neither a proper officer nor is competent to pass any order under the Customs Act, 1962 in as much as the Respondent No.4 was merely assigned the jurisdiction by the order of the Board dated 20.11.2012 and cannot, therefore, be an officer appointed under Section 4(1) of the Customs Act, 1962. Further, the Parliament in its wisdom has enacted the Central Goods and Service Act, 2017 w.e.f. 01.07.2017 and consequent to such enactment, there remains no officer designated as "Commissioner of Customs, Central Excise and Service Tax, Kanpur". The Commissioner of CGST and Central Excise, Kanpur and "Commissioner of Customs, Central Excise and Se....
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....d with the impugned show cause notice dated 22.06.2011 by the Respondent No.2 directing the petitioner, its Directors, its CHA's transferees of DFIA License and to whomsoever concerned to show cause as to why; (i) Goods having declared FOB value of Rs. 1,59,69,201/- should not be confiscated; (ii) Export duty amounting to Rs. 95,81,520/- should not be recovered along with interest; (iii) The amount of DFIA benefits availed against respective lincenses in respect of shipping Bill should not be denied and the licenses themselves may not be recommended for cancellation; (iv) Import duty forgone of Rs. 1,89,47,771/- should not be demanded and recovered along with interest and the goods so imported should not be confiscated; and (v) Penalty should not be imposed jointly and severally under Sections 114, 114A, 114AA and 117 of the Customs Act. 5. By order dated 20.11.2012 issued by the Board, the Respondent No.3 was appointed as Common Adjudicating Authority. However, the matter was kept pending and on 13.01.2020 a notice came to be issued by the Superintendent CGST and Central Excise, Kanpur Intimating the date of personal hearing befo....
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....ion 4 of the Customs Act confers power on the Board to appoint such persons as it thinks fit to be the officer of Customs but no notification under Section 4 has yet been issued notifying the Respondent No.4 as an officer of Customs. Likewise under Section 6 of the Customs Act, the Central Government is empowered to entrust either conditionally or unconditionally, to any officer of the Central Government or State Government or a local authority any functions of the Board or any officer of Customs under the Act but till date no such notification has been issued by the Central Government entrusting the Respondent No.4 with any function of the Officer of Customs. 8. He further submits that the Respondent No. 4 was earlier appointed as "Commissioner of Central Excise" under the Central Excise Act, 1944 and upon the enactment of the Central Goods and Services Tax Act, 2017 (CGST Act), the Respondent No. 4 will be deemed to be an officer appointed under CGST Act by virtue of Section 3 of the CGST Act and thus cannot be called a ""Proper Officer"" or "adjudicating authority" under the Customs Act. Consequently, the assumption of jurisdiction to proceed under the impugned notice is whol....
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....ing Counsel for the District Taxes in opposition to the writ petition submits that in view of the orders of the Board dated 10.11.2012, 09.06.2015 and 17.10.2018 read with the queries made by the Principal Chief Commissioner, CGST and Central Excise, Lucknow dated 31.05.2018 and the order of the Board dated 28.11.2019, the Respondent No. 4 has the jurisdiction to adjudicate the impugned show cause notice. 11. Sri Amit Mahajan, learned Senior Standing Counsel for direct taxes who has appeared in Writ Tax No. 1096 of 2021 submits that the Notifications above mentioned have been considered by the Gujrat High Court in Swati Menthol & Allied Chem. Ltd. versus Jt. Dir., DRI, [2014 (304) ELT 21 (Guj.)], and in view of the judgment of the Gujrat High Court, the writ petition has no merit and is liable to be dismissed. 12. Sri Krishna Agarwal, learned counsel for the respondent-DRI, in opposition to the writ petitions, submits that the DRI Officers and Customs, in view of the Notification No. 31/1997 (N.T.) dated 07.07.1997 and Notification No. 15/2002-Customs (N.T.) dated 07.03.2002 (as amended) issued under Section 4 (I) of the Customs Act, 1962 appointing the Commissioner of Custom....
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....pondent No.2 is possessed of the jurisdiction to issue the same and secondly, as to whether the Respondent No.4 has the jurisdiction to adjudicate the show cause notice issued by the respondent No.2. 14. In order to answer the questions aforesaid, it would be apt to consider certain provisions of the Customs Act, 1962 and refer to circulars and Notifications issued by the CBE & C. Section 2(34) of the Customs Act, 1962 defines the term "Proper Officer" as under:- "2(34) "proper officer", in relation to any functions to be performed under this Act, means the officer of customs who is assigned those functions by the Board or the [Principal Commissioner of Customs or Commissioner of Customs]" 15. The term "Proper Officer" is used at various places under the Act, under Section 17 it is "Proper Officer" who can verify the self-assessment of goods and examine or test any imported goods or exported goods as may be necessary. Likewise under Section 18 it is the "Proper Officer" who may undertake the exercise of provisional assessment and direct the importer to pay difference in duty or furnish security as deemed fit for provisional release of the goods. Section 28 of the Cus....
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....Preventive) which was questioned on the ground of jurisdiction of the Collector of Customs (Preventive) to proceed in the matter. It was in this background that the Apex Court rendered its decision holding that only such Custom Officers who have been assigned the specific functions of assessment and reassessment of duty either by the board or the Commissioner of the Customs in terms of Section 2(34) in the jurisdiction at area where the import concerned has been affected, who is competent to issue notice under Section 28 of the Act. 18. Perhaps since the decision of the Hon'ble Supreme Court in the case of Sayed Ali (Supra) would upset large number of pending and even concluded proceedings, the Legislature in its wisdom introduced sub- Section (11) of Section 28, which provides as under:- "(11) Notwithstanding anything to the contrary contained in any judgment, decree or order of any Court of law, Tribunal or other authority, all persons appointed as officers of Customs under subsection (1) of section 4 before the sixth day of July, 2011 shall be deemed to have and always had the power of assessment u/s 17 and shall be deemed to have been and always had been the pro....
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.... the Respondent No.2 can be stated to be an "Proper Officer", we may refer to the different notifications of the Central Board of Excise and Customs, which have been placed before us for consideration. 22. Notification dated 07.07.1997 provided as under:- "...... In exercise of the powers conferred by sub-section (1) of section 4 of the Customs Act, 1962 (52 of 1962) and in supersession of the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 38/63-Customs, dated 1st February, 1963 the Central Government hereby appoints the following persons to be the Officers of Customs, namely:- 1. Appraisers, Examiners, Superintendent Customs (Preventive), Preventive Officers, Women Searchers, Ministerial Officers and Class IV Officers in the Customs Department in any place in India. 2. Superintendents, Inspectors, Women Searchers, Ministerial staff and Class IV staff of Central Excise Department, who are for the time being posted to a Customs port, Customs airport, Land-Customs station, Coastal port, Customs preventive post, Customs Intelligence post or a Customs warehouse. 3. Superintendents, and Inspectors of ....
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....oms (Preventive), Deputy Commissioners or Assistant Commissioners of Customs (Preventive). 3. Additional Director Generals, Additional Directors or Joint Directors, Deputy Directors or Assistant Directors in the Directorate General of Central Excise Intelligence. 4. Commissioners of Central Excise, Additional Commissioners or Joint Commissioners or Central Excise, Deputy Commissioners or Assistant Commissioners of Central Excise. [F. No.437/143/2009-Cus.IV] (Vikas) Under Secretary to the Government of India" 25. Under the Notification dated 02.05.2012 the Central Board of Excise and Customs assigned various officers mentioned in Column No. 2 of the Table corresponding functions mentioned in column No. 3 thereof. Relevant portion of the Table reads as under:- Sl. No. Designation of the officers Functions under Section of the Customs Act, 1962 *** *** 4. Deputy Director or Assistant Director in the Directorate General of Revenue Intelligence and Directorate General of Central Excise Intelligence (i) Section 28B; and (ii) Section 72 *** *** 6. Intelligence Officer in the Directorate General of Rev....
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.... dated 04.04.2011 Additional Director General, Directorate of Revenue Intelligence, Lucknow Zonal Unit - Lucknow. M/s Crescent Tanners Pvt. Ltd., Kanpur 3 DRI F.No.VIII/DRI/LZU/2 6/26/2008/Iqbal dated.05.04.2011 Additional Director General, Directorate of Revenue Intelligence, Lucknow Zonal Unit - Lucknow. M/s Iqbal Leathers Limited, Kanpur 4 DRI F.No/VIII/DRI/LZU/2 6/26/2008/Model Exims dated 06.04.2011 Additional Director General, Directorate of Revenue Intelligence, Lucknow Zonal Unit - Lucknow. M/s Model Exims, Kanpur 5 DRI F.No/VIII/DRI/LZU/2 6/26/2008/Allied Leather dated.07.04.2011 Additional Director General, Directorate of Revenue Intelligence, Lucknow Zonal Unit - Lucknow. M/s Allied leather Finishers Pvt. Ltd., Kanpur 6 DRI F.No.VIII/DRI/LZU/2 6/26/2008/Seema dated.08.04.2011 Additional Director General, Directorate of Revenue Intelligence, Lucknow Zonal Unit - Lucknow. M/sSeema Exports, Kanpur 7 DRI F.No.VIII/DRI/LZU/2 6/26/2008/Homera Dt. 11.04.2011 Additional Director General, Directorate of Revenue Intelligence, Lucknow Zonal Unit - Lucknow. M/s Homera Tanning Industries Pvt. Ltd., Kanpur 8 DRI F....
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..../1340to1354 Dt. 26.08.2011 Additional Director General, Directorate of Revenue Intelligence, Lucknow Zonal Unit - Lucknow. M/s Hides International Limited Kanpur (erstwhile M/s KCK Exports Ltd. Kanpur). 17 DRI F.No.VIII/DRI/LZU/2 6/26/2008/Upper India /1272 to 1283 Dt.11.08.2011 Additional Director General, Directorate of Revenue Intelligence, Lucknow Zonal Unit - Lucknow. M/s Upper India Tannery Pvt., Kanpur 18 DRI F.No.VIII/DRI/LZU/2 6/26/2008/Superhouse Dt. 09.09.2011 Additional Director General, Directorate of Revenue Intelligence, Lucknow Zonal Unit - Lucknow. M/s Superhouse Ltd., 19 DRI F.No.VIII/DRI/LZU/2 6/26/2008/Penza / 1259 to 1268 Dt.26.09.2011 Additional Director General, Directorate of Revenue Intelligence, Lucknow Zonal Unit - Lucknow. M/s Penza Tanning Ind. Pvt. Ltd., Kanpur 20 DRI F.No.VIII/DRI/LZU/2 6/26/2008/Hafeez/ 1935-1940 Dt.09.12.2011 Additional Director General, Directorate of Revenue Intelligence, Lucknow Zonal Unit - Lucknow. M/s Hafeez Sons Tannery Pvt. Ltd., Kanpur 21 DRI F.No.VIII/DRI/LZU/2 6/26/2008/Homera Dt.12.01.2012 Additional Director General, Directorate of Revenue Intelligence, Luck....
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....ncipal DG, DRI. In this regard, the Board has prescribed the following guidelines for Principal DG, DRI: (a) The following cases initiated by DRI shall be assigned to Additional Director General (Adjudication), DRI: (i) Cases involving duty of Rs. 5 crores and above; (ii) Group of cases on identical issues involving aggregate duty of Rs. 5 crores or more; (iii) Cases involving seizure value of Rs. 5 crores or more; (iv) Cases of over-valuation irrespective of value involved; and (v) Existing DRI cases with erstwhile Commissioner (Adjudication) (b) Cases other than at (a) above involving more than one Customs Commissionerate would be assigned to the jurisdictional Commissioner of Customs on the basis of the maximum duty evaded; (c) Cases other than at (a) above involving a single Customs Commissionerate would be assigned to the jurisdictional Commissioner of Customs; (d) Non-DRI cases pending with erstwhile Commissioner (Adjudication) would be assigned to Additional Director General (Adjudication), DRI; (e) Past DRI cases pending for adjudication with jurisdictional Commissioners of Customs wou....
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....an officer of Customs to adjudicate the cases assigned to him. Further, Board's circular no. 18/2018-Customs dated 09.06.2015 lays down that past DRI cases pending for adjudication with the jurisdictional Commissioner of Customs continues with these officers. In view of the above, you are requested to direct the concerned officer to expedite adjudication proceedings. Yours faithfully, (Zubair Riaz) Director (Customs) 31. As noted, the notification for the purpose of Section 2(34) of the Customs Act assigns functions of the proper officer to the various officers including those under the Directorate of Revenue Intelligence, such as Additional Director, Joint Director, Deputy Director and Assistant Directors for the purposes of Sections 17 and 28 of the Customs Act. 32. From the perusal of the aforesaid notifications circulars and clarifications issued from time to time it is more than apparent that the Respondent No.2 had the jurisdiction to issue impugned show cause notice and the Respondent No.4 has the jurisdiction to adjudicate the same. The show cause notice under Section 28(1) could be issued by the "Proper Officer". A "Proper Officer" is one, who is de....