The Customs Department has approached the Supreme Court to reconsider a 2021 ruling which limited the authority of the Directorate of Revenue Intelligence (DRI) officers under the Customs Act of 1962. The department argued before a bench led by Chief Justice D Y Chandrachud that DRI officers should be recognized as customs officials capable of recovering duties on imported goods.
The legal contention emerged from a March 9, 2021, Supreme Court decision where a three-judge bench, including the then Chief Justice S A Bobde, determined that DRI officers were not “the proper officer” to enforce duty recovery on goods that had already been cleared by customs officials. This verdict had significant implications, leading to the quashing of show cause notices issued by the DRI to firms like M/S Canon India Private Limited, which included demands for duty payment, confiscation of goods, and penalties.
Additional Solicitor General N Venkataraman, representing the Customs Department, highlighted what he described as six “apparent errors on the face of records” in the 2021 judgement. He argued that the ruling failed to properly interpret legal provisions which, according to him, empower DRI officers as customs officials. “A DRI officer today can be a customs official tomorrow,” Venkataraman explained, emphasizing the integrated roles within the Ministry of Finance since 1977.*
The hearing, which was inconclusive and set to continue on Thursday, revisits the broader question of whether DRI has the jurisdiction to issue show cause notices for duty recovery under the Customs Act. This involves assessing duties not levied or paid on imported goods initially deemed exempt by customs authorities due to potential errors or omissions.
The 2021 verdict in question was based on the principle that it was “completely impermissible” for an officer, who did not make the original assessment order, to reopen the assessment. This was specifically applied to the Additional Director General of the DRI, who was not recognized as “the proper officer” for these actions under the Customs Act.
