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CASE NO.: Special Leave Petition (civil)  15872-15873 of 2005

PETITIONER: Commissioner of Customs & Ors.

RESPONDENT: Vasant Maganlal Chokshi & Ors.

DATE OF JUDGMENT: 07/11/2006

BENCH: Dr. AR. Lakshmanan & Altamas Kabir

JUDGMENT: J U D G M E N T

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

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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

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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.