The Supreme Court has reserved its verdict on a review plea filed by the Customs Department challenging a 2021 judgment that restricted the authority of the Directorate of Revenue Intelligence (DRI) officers in duty recovery for imported goods. The decision in question had determined that DRI officers do not have the authority to recover duties on goods that have already been cleared by customs for import.
During the four-day hearing, the bench, comprising Chief Justice D Y Chandrachud, Justices JV Pardiwala, and Manoj Misra, listened to arguments from both sides. Representing the Customs Department, Additional Solicitor General (ASG) N Venkataraman argued for overturning the 2021 judgment, citing “six apparent errors on the face of records” that he claimed undermined the legal provisions.
Venkataraman emphasized the historical integration of customs and DRI under the Ministry of Finance since 1977, arguing that DRI officers should be considered as customs officials capable of enforcing duty recoveries. Contrarily, the 2021 Supreme Court ruling, led by then Chief Justice S A Bobde, had held that a DRI officer is not “the proper officer” under the Customs Act to undertake such actions, leading to the quashing of several DRI show cause notices to private firms, including M/S Canon India Private Limited.
The case hinged on the legal interpretation of whether DRI officers could issue show cause notices under the Customs Act for the recovery of duties that were allegedly not levied or paid when goods were cleared for import. The judgment also addressed the issue of whether the Customs Act empowers recovery of duty not paid, part-paid, or erroneously refunded due to collusion or misstatements.
Senior advocate Mukul Rohatgi, representing the private companies, countered the review plea by stressing the stringent criteria for reviewing Supreme Court judgments, which necessitate clear errors apparent on the face of the record.
