Commissioner
of Customs & Ors Vs. Vasant Maganlal Chokshi & Ors [2006] Insc 746 (7 November 2006)
Dr.
Ar. Lakshmanan & Altamas Kabir
With
SLP Nos. 16621-16632/2005 Commissioner of Customs ... Petitioner Versus Vijay Champaklal
Chokshi & Ors. ... Respondents And SLP No. 16635/2005 Commissioner of
Customs ... Petitioner Versus M/s.Kirit Maganlal & Co. & Ors. ...
Respondents ALTAMAS KABIR,J.
All
these special leave petitions have been filed by the Commissioner of Customs, Navrangpura,
Ahmedabad. Since all the special leave petitions arise out of the same set of
facts, they have been taken up together for consideration.
On the
presumption that 78 bars of gold had been clandestinely imported, the Revenue
Department seized the same on 16th January, 1998, and issued show cause notices
to the concerned parties as to why the said 78 gold bars, said to be of foreign
origin, should not be confiscated under Section 111 (d) of the Customs Act and
also why personal penalty should not be imposed under Section 112 (a) of the
said Act.
Initially,
the Commissioner of Customs, by his Order dated 10th November, 2000, ordered confiscation of the seized gold bars. The
said order was challenged before the Customs, Excise and Gold (Control)
Appellate Tribunal (CEGAT) which by its Order dated 23rd August, 2001 set aside
the order of confiscation passed by the Commissioner on 10th November, 2000,
and remanded the matter to the Commissioner for de novo adjudication after
giving the noticees a reasonable opportunity of being heard.
In
remand, the Commissioner by his Order 23rd January, 2003, came to the conclusion that out of
the 78 gold bars, 70 bars had been received from genuine sources, but as far as
the remaining 8 bars of gold were concerned, the legality of their import had
not been properly explained. Consequently, the Commissioner directed
confiscation of 8 of the 78 gold bars which had been seized.
Separate
appeals were filed against the Commissioner's Order dated 23rd January, 2003. While the noticees filed the
appeals against the aforesaid order passed by the Commissioner on 23rd January, 2003, directing confiscation of the 8
bars of gold, the Department challenged the said order directing release of the
70 bars of gold. The appeals filed by the noticees were heard by the Customs,
Excise and Service Tax Appellate Tribunal (CESTAT) which by its Order dated
30th June, 2004, held that the 8 bars of gold which had been directed to be
confiscated did not bear any foreign mark and that there was no evidence that
the same had been illegally imported. The appeals filed by the noticees were
accordingly allowed and the order of confiscation was set aside.
The
aforesaid order of CESTAT dated 30th June, 2004, was challenged by the Department by way of a Writ
Petition, being S.C.A.No. 13519/2005. The noticees also filed a Writ Petition,
being S.C.A.No. 7342/2005, before the Gujarat High Court at Ahmedbad, inter alia,
praying for release of the 78 bars of gold. By its Orders dated 24th June, 2005 and 7th July, 2005, the High Court directed the petitioners and their
authorities to release to the noticees all the 78 bars of gold.
After
the High Court had directed the release of the 78 bars of gold, the appeals
filed by the Department came up for final hearing and disposal before CESTAT on
21st July, 2005.
Holding
that no relief could be granted since the High Court had already directed
release of the 78 bars of gold, the Tribunal dismissed the appeals filed by the
Department.
All
these special leave petitions arise out of the different orders passed by the
High Court as well as CESTAT.
Special
Leave Petition Nos. 15872-15873/2005 have been filed against the judgment and
order dated 24th June, 2005 and 7th July, 2005 passed by the Gujarat High Court
on the Writ Application filed by the noticees directing release of the 78 gold
bars.
Special
Leave Petition No.16621-16632/2005 have been filed against the order passed by
the Customs, Excise & Service Tax Appellate Tribunal at Mumbai on 21st July, 2005.
The
last of the three special leave petitions, being No. 16635/2005, has been filed
against the judgment and order passed by the Gujarat High Court at Ahmedabad on
7th July, 2005.
Mr.Radhakrishnan,
learned senior advocate, appearing for the petitioners, urged that the Tribunal
had committed a grave error in taking up and disposing of the appeals filed by
the noticees without at the same time disposing of the appeals filed by the
Department. It was submitted that inasmuch as the appeals filed by the noticees
had been heard independently and direction had already been given to release
the 78 bars of gold, which order was subsequently confirmed by the Gujarat High
Court, there was no scope of passing any other order in the appeals preferred
by the Department. Mr. Radhakrishnan submitted that the appeals filed by the
Department had been rendered infructuous since the same had not been taken up
along with the appeals preferred by the noticees. It was urged that the said
fact had been brought to the notice of the High Court but the High Court had
held that it was no longer possible to entertain such a plea since the pendency
of the appeals filed by the Department had not been brought to the notice of
the Tribunal when the appeals filed by the noticees were disposed of.
Mr. Radhakrishnan
urged that in the interest of justice the orders passed by the Tribunal in
appeals preferred by the noticees were required to be set aside and the
Tribunal should be directed to take up all the appeals, including the appeals
filed by the Department, together, for disposal.
The
aforesaid submissions were vehemently opposed on behalf of the noticees and it
was pointed out that the High Court had dealt with this question in its order
dated 7th July, 2005, passed in S.C.A.No.13519/2005 and had held that it was
not possible for the Tribunal on its own to link up two cross appeals unless
the said fact was brought to the notice of the Tribunal by the concerned party.
It was also observed that since the petitioner had failed in its duty in
pointing out the fact that the Department's appeal was pending when the
Tribunal took the assessee's appeal for hearing, it was no longer open to the
petitioner to turn round and to point a finger at the Tribunal in these
circumstances.
While
we are able to appreciate the anxiety now being shown by the Department, we are
unable to accept Mr. Radhakrishnan's submission that the decision of the
Tribunal, as also of the High Court, should be set aside in order to
accommodate the Department which had failed to point out to the Tribunal that
the appeals preferred by the Department were also pending. Such an order would
unsettle matters which have already been settled and would amount to giving
premium to the negligence of the Department especially when the Commissioner of
Customs, CESTAT and the High Court had all held in favour of the noticees and
have directed return of all the 78 bars of gold to them. More than 8 years have
passed since the gold bars were seized and there can be no justification for
the matter to be dragged on further on account of the laches of the Department.
There
is no special feature in this case which warrants any interference with the
orders passed by the Tribunal and the High Court and the special leave
petitions are accordingly dismissed. The Department is directed to forthwith
release all the 78 gold bars in question to the concerned respondent.
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