Punjab & Haryana HC: Matter involving irresponsible attitude of Custom Department referred to the CBI for further Investigation

Punjab & Haryana HC: Matter involving casual and irresponsible attitude of Department of Customs & Anti-Evasion Unit referred to the CBI for further Investigation

Devyani | Nov 8, 2021 |

Punjab & Haryana HC: Matter involving irresponsible attitude of Custom Department referred to the CBI for further Investigation

Punjab & Haryana HC: Matter involving casual and irresponsible attitude of Department of Customs & Anti-Evasion Unit referred to the CBI for further Investigation

Sunil Dutt Vs. Dept. Of Customs, Customs Commissionerate, Ludhiana & Anr.(Punjab & Haryana HC); CRM-M-42144-2021 (O & M); 13.10.2021

Facts:

  • The petitioner is a GCard holder and is doing the job of liaison in movement of the files of his clients before the Customs Department, so as to get clearance of the assessment of custom duty.
  • The petitioner has moved a file for M/s P. S. Traders, Patiala regarding importing of a consignment from Dubai on 08.04.2021. As per the documents attached with the file, the same was cleared, however, the petitioner was not approached by the party regarding payment of the custom duty.
  • Later on, it came to the notice of the petitioner that the importer has managed to remove the consignment from ICD without paying the custom duty.
  • Thereafter, in April, 2021, the Customs Department issued a notice to the petitioner under Section 108 of the Customs Act, 1962 for appearing and giving reply to the notice, however, the petitioner did not appear before the Department concerned as he was apprehending arrest.

Issue:

The present Petition is a second petition filed for grant of Anticipatory bail to the petitioner in Complaint Case, for offences under the Customs Act (Sections 135, 135-A, 132 and other Sections of Customs Act) pending before the Department of Customs, Customs Commissionerate, Ludhiana. The first bail application was dismissed on the following grounds;

  • Even when the notice to the petitioner was issued on various dates w.e.f. 12.08.2021 and instead of appearing before the custom authorities, the petitioner preferred to present his anticipatory bail application before the Court of sessions, which was dismissed on 24.08.2021.
  • In view of the decision in the judgment by the Hon’ble Supreme Court of India in Union of India versus Padam Narain Aggarwal and Others in Criminal Appeal No.-1575 of 2008 decided on 03.10.2008, wherein, in similar circumstances it was held that at the stage of issuance of a notice under Section 108 of the Customs Act, 1962, if bail is granted, it will amount to a blanket bail which is not permissible.
  • Even otherwise there were serious allegations of causing a huge financial loss to the State Exchequer and therefore, even on merits, the petition was considered liable to be dismissed.

Petitioner ‘s contention in present petition:

(a) The petitioner is a registered informer of General Goods and Service Tax, Commissionerate (GST) i.e. respondent No.2 and has helped in unearthing many scams and GST Evasion for which he has been granted award.

(b) The petitioner is enrolled as a G – Card Holder by the Department of Customs on behalf of M/s. Safe Cargo Clearing Services and being a G – Card Holder, the petitioner is assisting in moving the files of the parties in the Department of Customs for handling the custom clearances and has also obtained a KYC Form, Import-Export Code, PAN Card, Aadhar Card, etc. from Prabhjot Singh.

(c) The petitioner has initially given the information to GST Department regarding a consignment which was illegally cleared by the Customs Department without making any entry and the same was intercepted by Preventive Wing of CGST Commissionerate, Ludhiana and it was found that the shipping line seal of the container was intact and not broken which suggested that the Customs Authorities never checked the consignment. When the consignment was checked by the Preventive Wing of CGST Commissionerate, Ludhiana, it was found containing 39,60,000 Cigarettes (100 mm each) of four different brands, 10030 Kgs of iron scrap and 04 alloy wheels.

(d) The petitioner was apprehensive that since he has unearthed a scam, he may fell to the ire of the Customs Department as the Custom Official, who was the Port Incharge, when the consignment was allowed to move out of the Port without making any entry, is now made the Head of the Special Investigative Team and therefore, the petitioner has every apprehension that he will not get the justice.

Observations and findings:

  • It was observed that on the first date of hearing, Mr. Amanjit Singh, Joint Commissioner, Central GST Commissionerate, Ludhiana, has sent a Secret Note in a sealed cover stating that the petitioner – Sunil Dutt was the secret informer/source from whose information, the consignment was confiscated by the Central GST, Ludhiana, leading to recovery of aforesaid articles.
  • The Court was surprised to find that 02 Departments i.e. Department of Customs, Customs Commissionerate, Ludhiana – respondent No.1 and Anti-Evasion Unit, Central Goods & Service Tax, Commissionerate, Ludhiana – respondent No.2, are fighting tooth and nail regarding fixing the liability as to how the consignment was cleared manually without making any entry by the Customs Department and as per stand of the Customs Department, there is a collusion of the official of the CGST Department with the petitioner and the other accused and in that process, the CGST Department is posing the petitioner as a Secret Informer/Source and has even filed a Secret Note under the signatures of Joint Commissioner, Central GST Commissionerate, Ludhiana, giving a clean chit to the petitioner – Sunil Dutt.
  • The bench opined that though the officers of Customs Department as well as the CGST Department, derives their powers from the respective Customs Act, 1962 and the Central Goods and Services Act, 2017 and both Departments are part of premium investigating agencies, however, instead of fighting and levelling allegations against each other, the office of the Director General of both the Departments, should have intervened and settled the dispute.
  • Therefore, taking note of the tardy, casual and irresponsible attitude of both the departments, The Ld. Bench found it to be a fit case where the matter needs to be referred to the Central Bureau of Investigation (CBI) for conducting further investigation of the case and fix liability of the erring officials.

Held:

A copy of order was directed to be sent to the Director General of Customs as well as the Director General of CGST, with a direction to ensure that all co operation is provided to the investigating Agency.

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