Lanvin Synthetics Pvt. Ltd. vs Union of India

We have heard Mr. Shroff learned senior counsel on behalf of the Petitioner and Mr. Jetley learned counsel appearing on behalf of the respondents. The grievance in this writ petition is that a notice to show cause dated 13th March 1997 was served on the petitioner alleging that the petitioner No. 1 was issued a conditional advance licence. The compliance was to be made with the condition that the petitioners would export polythene/viscose blended fabric. The allegations were that there is a collusion between the 2nd petitioner and a third party by which incorrect/manipulated/false information regarding quantities/weight/composition of the exported goods was provided to show compliance of the terms and conditions of the licence. That is how a waiver was obtained of the condition to furnish a bond in favour of the Government of India and towards the duty liability. Be that as it may, the show cause cum-demand notice in 1997 demanded Rs. 2,83,59,851/- and upon adjustment of Rs. 2,07,57,074/- already deposited.

The petitioners claim that from April 1997 to January, 2000 and thereafter from 2007 several letters were addressed requesting the authorities to proceed with the matter or to drop the proceedings and retain the money.

There is no adjudication of the show cause notice and equally the money has been retained wrongfully and illegally. Therefore, two prayers are made in the writ petition and one is in the nature of a declaration that the show cause notice now cannot be adjudicated sheerly by efflux of time. The basis is that nearly 18 years have lapsed from the issuance of the same and therefore, there is no power in the adjudicating authority to proceed and pass an adjudication order in terms of such a stale show cause notice. It be therefore, cancelled and quashed and the respondents be directed to return the sum of Rs. 2,07,57,074/- stated to be deposited under protest together with interest.

We had on the earlier occasion passed an order enabling Mr. Jetley learned counsel appearing on behalf of the respondents to take instructions as to whether any adjudication order was passed in pursuance of the show cause notice.

On instructions, Mr. Jetley informs the Court that no order has been passed in pursuance of this show cause notice.

We have now and in the course of dealing with this petition noted the disturbing state of affairs. If indeed the said show cause notice has been issued but, by mere passage of time the records and documents based on which the same was issued are either destroyed or lost, then, the superior authorities ought to have conducted inquiries and investigations. It was their responsibility and duty to find out why old show cause notices have still not been adjudicated nor any adjudication order passed or directions issued to drop the proceedings. Eventually, they are dealing with public money. The powers conferred in them are in the nature of trust. They cannot merely issue show cause notices and thereafter not take steps to adjudicate the matter and in accordance with law. That would be detrimental to public interest. If public revenue is not recovered in time and yet investigations are not held, as to why proceedings could not be taken to their logical end, then, this Court cannot be a silent spectator.

Let Mr. Jetley learned counsel appearing on behalf of the respondents take instructions and file an affidavit of a competent official as to whether any inquiry or investigations at the higher level have been initiated by warning and cautioning the Commissioner to take up old cases and on priority for adjudication and disposal and if steps and measures have been taken then, what is the outcome thereof. Further, we are concerned with the Commissionerate at Mumbai. They should also file an affidavit stating how may proceedings of the nature complained of are pending, their number and what steps would be taken to deal with them or conclude them in accordance with law. We grant two weeks time to Mr. Jetley learned counsel appearing for the respondents to do the needful. We would pass final orders on the petition after a period of two weeks. Post it for passing orders on 15th July 2015.