Om Drishian International Ltd. vs Dir. of Revenue Intelligence

The petitioner has approached this Court impugning a notice to show cause dated 23 June, 2014. The Counsel appearing for the petitioner submitted before us that the show cause notice has been issued to about 35 persons. The same refers to several acts of omission and commission at different places namely within the Commissionerate of Nhava Sheva Port, Mumbai, at Kandla Port in the State of Gujarat, at Tuglakabad, New Delhi and at Kolkata. He submits that the show cause notice which ropes in about 35 entities and whose business connection or commercial dealings or nexus have not been stated to be linked nor a business link established. Issuance of this show cause notice and to 35 persons together would itself vitiate it and on several grounds. Further, a chart or tabulation at page 110 of the Paper Book would show that the notice though styled as notice to show cause is not as such. It refers to a determination already made. Thus, the issues in the show cause notice are already adjudicated upon. If everything is decided before hand and in advance, then such a notice, though styled as show cause notice, must fall to the ground.

We have also been shown several aspects and which have been, according to the Counsel, brought together. In that regard we have been shown the contents of the show cause notice and copy of which is at Annexure "A" to the petition Paper Book. That refers to several entities in Para 2.2 and then, makes a reference to claims or incentives. The Counsel, therefore, submits that instead of segregating and separating the issues, allegations and persons, such grouping of issues and persons together will have to be considered at the threshold or else the petitioner would be subjected to proceedings wherein the adjudication and determination will only be a formality.

Mr. Jetly, learned Counsel appearing on behalf of the Revenue, on the other hand, submits that the petitioner has approached this Court challenging the show cause notice. The principles are too well settled for this Court to interfere in its writ jurisdiction in a notice to show cause, unless the petitioner demonstrates that it is without jurisdiction or that the show cause notice has been issued with ulterior motives or result of a mala fide act on the part of certain specified authorities or officials, this Court cannot go into the subject matter of the show cause notice nor determine whether the allegations levelled against the petitioner and the demand raised would eventually succeed.

Additionally, on instructions, Mr. Jetly submits that the apprehension of the petitioner and the parties like them that they would be made to face three adjudicators at three different venues, can be taken care of and inasmuch as there are certain requests made to the Central Board of Excise & Customs, that Board in terms of its guidelines and policy decision will ensure that the adjudicator at one place will adjudicate and decide the show cause notice. The noticees may not be required to travel and attend several adjudicating officers and at different venues. In these circumstances, on this count, the petitioner need not have any apprehension.

As far as other aspects are concerned, Mr. Jetly clarifies that the tabulation and the chart only indicates the figures and which eventually would be finalized only after adjudication. These amounts may be due and payable in the event the allegations in the show cause notice are proved. Today, by merely relying on them, the petitioner cannot contend that there is any pre-determination or pre-adjudication of the allegations in the show cause notice. Consequently, he submits that the writ petition has no merits. It should be dismissed.

After hearing both sides and perusing the writ petition Paper Book together with some of the parts of the show cause notice, to which our attention has been invited by the Counsel for the petitioner, we are of the view that writ petition need not be entertained at this stage. Apart from settled principles, which indicate as to how the writ jurisdiction has to be exercised and for interfering with the show cause notice, we are satisfied that the apprehension of the petitioner that the noticees may have to travel and face adjudication at several venues at the hands of different adjudicating officers is taken care of by the statement made, on instructions, by Mr. Jetly. We accept it as an undertaking given to this Court. We direct that the respondents shall take the requisite steps so as to comply with their own guidelines and circulars to ensure that the adjudication will be held and concluded at one venue and not requiring the petitioner to travel and attend the offices of several adjudicating authorities, bodies or officers, particularly at Delhi, Mumbai, in the State of Gujarat or at Kolkata.

The argument that there is a pre-adjudication and pre-determination of the issues raised in the show cause notice need not detain us. That may require us to go into the contents and particularly merits of the show cause notice, which is not permissible at this stage. We clarify that it would be open for the petitioner to raise all contentions including those based on the grounds in the writ petition at the adjudication of the show cause notice, it would also be open to them to contend that despite their appearance before the adjudicating authority, the show cause notice and to several persons, combining several issues, several acts of omission and commission alleged to have been committed by the persons and entities having no business connection or business relation makes the show cause notice itself vulnerable. That show cause notice purports to level certain allegations and serious doubts, but there is already determination or adjudication with regard thereto and issuance of such notice is, therefore, a mere formality. These and all contentions are kept open for being raised by the petitioner before the adjudicating authority and equally at an appropriate stage thereafter. We clarify that disposal of this writ petition shall not affect, much less prejudice their rights and contentions, each one of them can be raised before the adjudicating authority and thereafter at an appropriate stage before the appropriate forum.

Writ petition is disposed of. All concerned to act on authenticate copy of this order.