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2018 DIGILAW 62 (MEG)

R. Rajesh Naykar v. Commissioner of Customs

2018-09-14

MOHAMMAD YAQOOB MIR, S.R.SEN

body2018
ORDER : Mohammad Yaqoob Mir, J. 1. Petitioner had earlier filed WP (C) No. 303 of 2015 but same due to subsequent development i.e. issue of show cause notice dated 17.03.2016 at request stand dismissed as withdrawn with liberty to the file fresh one, hence the instant petition. 2. Petitioner seeks quashment of show cause notice dated 12.10.2015 issued to Shri S Subhash Singh and also another show cause notice dated 17.03.2016 issued to Rajesh Naykar (petitioner). He also seeks to quash seizure case dated 24.07.2015. Further, prays for quashing the other proceedings initiated by the Customs Authorities under the provisions of the Customs Act, 1962 with a further prayer to direct the respondents to release the seized goods in his favour. 3. From the respective pleadings of the parties what has emerged is that 24th Battalion Assam Rifles on special inputs regarding smuggling of illegal gold from Moreh to Imphal, on 24.07.2015 at Khundengthabi spotted one vehicle (Maruti van) matching with the description of the vehicle as was provided in the information, stopped it on checking and search, twenty pieces of yellow metal (THOON) marking, suspected to be gold of foreign origin, wrapped in carbon paper then in a plastic was concealed in a secret compartment in the right side of the vehicle were recovered. 4. The said vehicle was driven by Shri Soibam Subhash Singh who was detained along with the vehicle and handed over to the Customs officers at Moreh. The Customs officers detained the driver who identified himself as Soibam Subhash Singh. On demand, the driver could not produce any valid documents with regard to possession, acquisition, purchase, transportation, importation of yellow metal (suspected to be gold of foreign origin). The weight of the yellow metal was found 3320 grams valued at Rs. 83,00,000/- (Rupees eighty three lakh) only. Value of the vehicle was assessed at Rs. 1,50,000/- (Rupees one lakh fifty thousand) only. Samples were drawn from the piece of yellow metal. Seizure Case No. 11/CL/IMP/CUS/MOR/2015-16 dated 24.07.2015 under Section 135 (b) (ii) of Customs Act, 1962 was registered. Inventory of the seized goods was prepared. The statement of the driver was also recorded. 5. Value of the vehicle was assessed at Rs. 1,50,000/- (Rupees one lakh fifty thousand) only. Samples were drawn from the piece of yellow metal. Seizure Case No. 11/CL/IMP/CUS/MOR/2015-16 dated 24.07.2015 under Section 135 (b) (ii) of Customs Act, 1962 was registered. Inventory of the seized goods was prepared. The statement of the driver was also recorded. 5. A show cause notice (impugned) dated 12.10.2015 under Section 124 of the Customs Act, 1962 was served upon the driver Shri Soibam Subhash Singh calling upon to show cause to the Commissioner of Customs (Preventive), Shillong within 30 (thirty) days of receipt of the notice as to why seized gold biscuits/vehicle/documents etc. as listed in the inventory collectively valued at Rs. 84,50,000/- (Rupees eighty four lakh fifty thousand) only shall not be confiscated under Sections 111 (b) (d) and 115 of the Customs Act, 1962 and why penalty be not imposed under Section 112 (b) (ii) of the Customs Act, 1962. He was also asked to produce all documentary evidences whatever he had along with written submission in support of his defence and to indicate whether he desired to be heard in person in support of the reply to the show cause notice. 6. It appears that the said driver had not responded to the show cause notice dated 12.10.2015. In the meanwhile, the respondent No. 1 had received the letter from the petitioner wherein, the petitioner had claimed legitimate ownership of the seized goods and had sought release thereof. His identity till 12.10.2015 was not known therefore, on receipt of his letter further investigation was carried out into the matter. 7. The petitioner claimed that he had purchased the said gold from M/s. Sangham Diamonds Pvt. Ltd., Mumbai and has also given the detail of purchase and reason for sending the said gold to Imphal for reselling. His identity till 12.10.2015 was not known therefore, on receipt of his letter further investigation was carried out into the matter. 7. The petitioner claimed that he had purchased the said gold from M/s. Sangham Diamonds Pvt. Ltd., Mumbai and has also given the detail of purchase and reason for sending the said gold to Imphal for reselling. Based on the investigation so carried out, the Commissioner of Customs (Preventive) took a view that there is reason to believe that the said goods were smuggled to India through a route not specified under Section 7 (1) (c) of the Customs Act of 1962 and also in violation of Section 11 of the Act read with the Foreign Trade (Development and Regulation) Act, 1992 rendering the same liable to confiscation under Section 111 (b) (d) of the Customs Act, 1962 and also took a view that the petitioner is liable to penal action under Section 112 (b) (ii) of the Customs Act, 1962. 8. A show cause notice No. VIII/(10)56 CUS/SH/2015/11159 (B) dated 17.03.2016 under Section 124 of the Customs Act, 1962 was sent to the petitioner but was returned un-served by the Postal department. Finally, the Inspector of Customs (Preventive) Moreh has personally delivered the supplementary show cause notice to the petitioner on 24.05.2016, now impugned in this petition. The petitioner has not responded to the said show cause notice instead has filed the instant petition. 9. The contention of the learned counsel for the petitioner is that in terms of Section 110 (2) of the Customs Act, 1962, goods can be seized subject to the adherence to the conditions prescribed under Section 110 itself. While referring to sub-section (2) of Section 110 would submit that notice regarding seizure of goods is required to be given under clause (a) of Section 124 within six months of the seizure of the goods which period can be extended by the Principal Commissioner of Customs or Commissioner of Customs for a further period of six months provided sufficient cause is shown. 10. In the context of Sections 110 (2) and 124 of the Customs Act, 1962, the contention of the petitioner is that the show cause notice was not issued within the prescribed period. 10. In the context of Sections 110 (2) and 124 of the Customs Act, 1962, the contention of the petitioner is that the show cause notice was not issued within the prescribed period. The respondents in their affidavit have stated that the gold was seized on 24.07.2015, show cause notice was served upon the driver on 12.10.2015, from whose possession gold was recovered. Subsequently, petitioner claimed ownership, then, after proper investigation, show cause notice was issued and sent to him on 17.03.2016. 11. In terms of Section 110, on sufficient cause, notice was issued well within the extended six months period. Whether same is factually correct or incorrect give rise to the disputed question of facts better to be adjudicated upon by the Commissioner of Customs (Preventive), Shillong. 12. Claim of the petitioner to be the owner of the gold then, that the notice was not served upon him well within time being disputed question of facts, it was appropriate for the petitioner to have responded to the show cause notice. 13. The Customs Act, 1962 itself prescribes the procedure for seizure, acquisition and imposition of penalty etc. The Commissioner of Customs (Preventive), Shillong, had to consider the reply to the show cause notice and to hear the petitioner and then to pass appropriate orders. The aggrieved party of the order of Commissioner of Customs (Preventive), Shillong has the right to appeal under Section 129 before the forum i.e. Appellate Tribunal called "Customs, Excise and Service Tax Appellate Tribunal". Then again, as against the Appellate Tribunal order, the aggrieved party has a remedy of appeal under Section 130 of the Customs Act, 1962 before the High Court. 14. Filing of the writ petition in effect appears to be aimed at scuttling the procedures and remedies available under the Act when efficacious remedies are available before the Customs authorities itself then before the Appellate Tribunal and High Court by way of appeals, there could be no reason or justification for entertaining the writ petition. 15. Learned counsel for the petitioner tried to project that filing of the writ petition is not barred more so when the entire proceedings initiated by the respondents are defective and in contravention to the provisions of the Customs Act, 1962. 16. It is trite that jurisdiction under Article 226 of the Constitution is unfettered but governed by self imposed restriction. Learned counsel for the petitioner tried to project that filing of the writ petition is not barred more so when the entire proceedings initiated by the respondents are defective and in contravention to the provisions of the Customs Act, 1962. 16. It is trite that jurisdiction under Article 226 of the Constitution is unfettered but governed by self imposed restriction. Self imposed restriction take into its sweep (i) efficacious remedies available to the aggrieved party (ii) when the whole process is noticed to be without jurisdiction; and (iii) otherwise on admitted facts is to result in unnecessary dragging of the parties into unwanted proceedings. 17. Invocation of jurisdiction under Article 226 of the Constitution depends upon facts, circumstances and law in each case. 18. In the stated facts of the case, the petitioner has to respond to the show cause notice and to project all factual and other grounds which he had available against seizure and confiscation, it was for the authorities concerned to consider the objections, grounds and then to pass appropriate orders, thereto. 19. Learned counsel for the respondents stated that the authorities have kept the proceedings on hold in view of the pendency of this writ petition. While praying for dismissal of this writ petition on the ground of available efficacious remedies/forums to the petitioner, has relied on the judgment rendered by the Hon'ble Apex Court in the case of "Special Director and anr v. Mohd. Ghulam Ghouse and anr: (2004) 3 SCC 440 . Para 5 of the judgment is advantageous to be quoted:- "5. This Court in a large number of cases has deprecated the practice of the High Courts entertaining writ petitions questioning legality of the show-cause notices stalling enquiries as proposed and retarding investigative process to find actual facts with the participation and in the presence of the parties. Unless the High Court is satisfied that the show-cause notice was totally non est in the eye of the law for absolute want of jurisdiction of the authority to even investigate into facts, writ petitions should not be entertained for the mere asking and as a matter of routine, and the writ petitioner should invariably be directed to respond to the show-cause notice and take all stands highlighted in the writ petition. Whether the show-cause notice was founded on any legal premises, is a jurisdictional issue which can even be urged by the recipient of the notice and such issues also can be adjudicated by the authority issuing the very notice initially, before the aggrieved could approach the court. Further, when the court passes an interim order it should be careful to see that the statutory functionaries specially and specifically constituted for the purpose are not denuded of powers and authority to initially decide the matter and ensure that ultimate relief which may or may not be finally granted in the writ petition is not accorded to the writ petitioner even at the threshold by the interim protection granted." 20. The petitioner was required to file response to the show cause notice within the time prescribed therein which he has not but now the matter has been pending before this Court and it is stated by the learned counsel for the respondents that the authority concerned i.e. Commissioner of Customs (Preventive), Shillong has kept the proceedings on hold in view of the pendency of this petition, therefore, in our considered view, it shall be apposite to dispose of the writ petition in the following manner:- (a) The Commissioner of Customs (Preventive), Shillong shall provide 15 days time to the petitioner to file his response to the show cause notice; (b) The petitioner shall file his reply to the show cause notice and shall be at liberty to project all the grounds as shall be available to him in defence; (c) The respondent-Commissioner of Customs (Preventive), Shillong shall consider the reply of the petitioner and shall also afford him an opportunity of hearing. After considering the entire material and the response of the petitioner shall pass the order as shall be warranted in accordance with the provisions of the Customs Act, 1962. 21. Disposed of as above.