The Supreme Court on Tuesday commenced hearing a plea of the customs department seeking a review of its 2021 judgement holding that the officers of the Directorate of Revenue Intelligence (DRI) have no authority to seek recovery of duties on goods already cleared for import by the customs department. The matter, which has seen many ups and downs, was decided by a three-judge bench headed by the then Chief Justice S A Bobde on March 9, 2021.
The legal question involved was whether the DRI has the authority to issue a show cause notice under the Customs Act for recovery of duties allegedly not levied or paid when the goods were cleared for import by a Deputy Commissioner of Customs who decided that the imports were exempted from duties.
It had also dealt with the issue of whether a provision of the Customs Act “empowers the recovery of duty not paid, part paid or erroneously refunded by reason of collusion or any wilful misstatement or suppression of facts” by “the proper officer”.
The apex court had then held that it was “completely impermissible” to allow an officer, who has not passed the original order of assessment, to re-open the assessment.
It had held that the Additional Director General of the DRI was not a “proper officer” under the Customs Act to seek recovery of duty on imported goods.
Later, a bench headed by successor CJI N V Ramana, on May 19, 2022 agreed to hear in an open court the review plea of the customs department against the 2021 judgement.
On Tuesday, a bench comprising present Chief Justice D Y Chandrachud and Justices JB Pardiwala and Manoj Misra commenced hearing the review plea.
Additional Solicitor General N Venkataraman started advancing the arguments in the case and assailed the verdict under review.
The 2021 verdict had come on a batch of cases filed by M/S Canon India Private Limited and other private firms against the Commissioner of Customs challenging the 2017 judgement of the Central Excise and Service Tax Appellate Tribunal (CESTAT).
The CESTAT had upheld the show cause notice of the DRI to private firms seeking payment of duty and the consequential confiscation of goods, demand of interest, and imposition of penalty under the Customs Act.
It was the case of the private firms that the cameras, which were imported, were exempted from levy of basic customs duty as per a 2012 notification.
The exemption from import duty to “Digital Still Image Video Cameras” was issued on March 1, 2005 and the notification was amended in 2012.
