Facts of the Case

The present batch of writ petitions challenged multiple Show Cause Notices (SCNs) and consequential adjudication proceedings initiated under the Customs Act, Finance Act, and CGST Act.

The petitioners contended that adjudication proceedings had remained pending for excessively long periods—sometimes extending to decades—without conclusion.

The disputes also involved proceedings initiated by officers of the Directorate of Revenue Intelligence (DRI), raising issues regarding their authority as “proper officers.”

Issues Involved

  1. Whether inordinate delay in adjudication of SCNs renders the proceedings liable to be quashed.
  2. Whether delay alone constitutes sufficient ground to invalidate proceedings.
  3. Interpretation of Section 28(9) and 28(9A) of the Customs Act post amendments.
  4. Impact of judicial precedents on the concept of “Proper Officer” (DRI jurisdiction).
  5. Whether placement of matters in “call book” justifies delay.

Petitioner’s Arguments

  • The petitioners argued that adjudication must be completed within a reasonable time, even if the statute earlier used flexible language.
  • Delay of several years/decades violates principles of natural justice and causes serious prejudice.
  • The Finance Act, 2018 amendments reflect legislative intent to strictly enforce timelines.
  • Under amended Section 28(9A), failure to conclude proceedings leads to deemed conclusion of SCNs.
  • Proceedings kept pending indefinitely are arbitrary and unsustainable in law.

Respondent’s Arguments

  • Delay by itself cannot automatically invalidate adjudication proceedings.
  • Determination of “reasonable time” depends on facts of each case.
  • Delay occurred due to:
    • Legal uncertainty from Supreme Court rulings like Canon India and Sayed Ali
    • Issues regarding DRI officers as “proper officers”
    • Administrative reasons such as placement in call book
  • Proceedings were not deliberately delayed but affected by legal flux and systemic factors.

Court’s Findings / Order

  • The Court emphasized that adjudication must be concluded within a reasonable period, even where statutes earlier used flexible language.
  • Inordinate and unexplained delay can vitiate proceedings.
  • The Court held:
    • Delay cannot be justified merely by administrative practices like call book placement.
    • Legal uncertainty may explain delay but cannot justify indefinite pendency.
  • The statutory scheme under Section 28 reflects clear timelines for adjudication, especially post amendments.
  • Where delay is excessive and unjustified, proceedings are liable to be interfered with or quashed.

Important Clarifications by the Court

  • “Reasonable time” is implicit in all adjudicatory powers, even if not expressly stated.
  • The omission of the phrase “where it is possible to do so” indicates stricter legislative intent.
  • Section 28(9A) introduces a legal fiction of deemed conclusion in certain situations.
  • Call book mechanism cannot override statutory timelines.
  • The issue of “proper officer” (DRI jurisdiction) remains significant but does not justify prolonged delay.

Link to download the order -  https://delhihighcourt.nic.in/app/showFileJudgment/YVA10122024CW48312021_173726.pdf 

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