The Supreme Court has allowed the customs department review petition in the case of Commissioner Of Customs Vs. M/S Canon India Private Limited and held that Directorate of Revenue Intelligence (DRI) Officers are A ‘Proper Officer’ to issue show-cause notices under Customs Act.
The bench of Chief Justice of India DY Chandrachud, Justices JB Pardiwala and Manoj Misra observed that DRI officers are “proper officers” to issue show cause notices under Section 28 of the Customs Act, 1962.
Table of Contents
Top Rationale Behind Allowing Review Petition In Canon India Judgment
DRI Empowered to issue SCN under CBEC Circular No.4/99 dated 15.02.1999 & Notification no.44/2011 dated 06.07.2011
The Apex court noted that Central Board of Excise and Customs has issued the Circular No.4/99 dated 15.02.1999 and Notification no.44/2011 dated 06.07.201 which gave powered to the officers of DRI to issue show-cause notices under Section 28 of the Customs Act.
Canon India Judgement Failed To Look Into The Statutory Scheme
Both the Circular No.4/99 dated 15.02.1999 and Notification no.44/2011 dated 06.07.201 which assigned the functions of “proper officers” to the DRI Officers to issue show cause notice under Sections 17 and 28, were not brought to the notice of this Court during the proceedings in Canon India.
The judgement in Canon India was pronounced without looking into the circular and notification, therefore seriously affecting the correctness of the same. The decision in Canon India failed to look into the statutory scheme.
Background – Canon India Judgment
The bench of the then CJI SA Bobde, Justice AS Bopanna and Justice V Ramasubramanian in Canon India had held that the DRI Officer will not be empowered to issue show-cause notices under Customs Act without entrustment of functions by the Central Government under section 6 of the Customs Act, 1962.
The customs department filed the review petition against the judgement of the Supreme Court Judgment in Canon India Private Ltd. versus Commissioner of Customs, in which it was held that the entire proceeding initiated by the Additional Director General of the DRI by issuing show cause notices in all the matters are invalid without any authority of law and liable to be set-aside and the ensuing demands are also set-aside.
On 19 September, the bench of CJI DY Chandrachud, Justices JB Pardiwala and Manoj Misra reserved the Judgment on customs dept’s review petition on the issue whether Directorate Of Revenue Intelligence (DRI) is the proper officer to initiate of the recovery proceedings under Section 28(4) of the Customs Act.
Customs Dept. Stand – Canon India Judgment
The department contended that the judgement suffered from at least six apparent errors on record.
The department contended that the DRI officers are a part of the finance ministry and exercise the powers of Customs officers.
Case Details
Case Title: Commissioner Of Customs Vs. M/S Canon India Private Limited
Case No.: R.P.(C) No. 000400/2021
