1 2025:CGHC:20978 AFR HIGH COURT OF CHHATTISGARH AT BILASPUR WPC No. 3176 of 2022 Rajendra Kumar Jain S/o Shree Mohan Lal Jain Aged About 65 Years Proprietor of M/s Saheli Jewellers, 126, 127 Aakash Ganga Supela, Bhilai Chhattisgarh, R/o 162 Aapapura, Bhoipara, Gandhi Chowk District Durg Chhattisgarh. ... Petitioner versus 1 - Union of India Through the Joint Director, Directorate of Revenue Intelligence (DRI), Government of India, Indore Zonal Unit, 1st Floor, BSNL Telephone Exchange Building, Transport Nagar Indore, District Indore Madhya Pradesh. 2 - Deputy Director Directorate of Revenue Intelligence, Government of India, Raipur Regional Unit, 30, Panchsheel Nagar, Civil Lines, Raipur, District Raipur Chhattisgarh. 3 - Additional / Joint Commissioner of Customs B-Zone, 3rd Floor, 12/27 and 12/28, Village Pipliyakumar, Nipania, Indore District Indore Madhya Pradesh. 452010. ... Respondents (Cause-title taken from Case Information System) For Petitioner : Mr. Manish Upadhyay and Mr. Prabhakar Tiwari, Advocates For Respondents : Mr. Maneesh Sharma, Advocate YOGESH TIWARI Digitally signed by YOGESH TIWARI Date: 2025.05.16 17:45:25 +0530 2 Hon’ble Shri Amitendra Kishore Prasad, Judge Order on Board 06.05.2025 1. Heard Mr. Manish Upadhyay and Mr. Prabhakar Tiwari, learned counsel for the petitioner as well as Mr. Maneesh Sharma, learned counsel for the respondents. 2. By way of this writ petition, the petitioner is questioning the show- cause notice dated 18.06.2022 passed by Government of India, Ministry of Finance (Department of Revenue), Directorate of Revenue Intelligence (DRI) Indore Zonal Unit (IZU), by which the petitioner was directed to submit reply to the show-cause notice alleging that he has received smuggled gold of foreign origin being carried by two persons, who were travelling in a Train from Kolkata to Bilaspur and upon secret information, they were intercepted, however, only one person was caught hold by the team of Officials and other person, namely Ranjit Samanta could not be intercepted. The intercepted person namely Satinath Dhara was caught and handed over to the Officers of DRI. One gold bar approximately 1 kg. was recovered from the possession of Satinath Dhara. A notice under Section 102 of the Customs Act, 1962 for personal search before Gazetted Officer was issued to Satinath Dhara and thereafter, search and seizure was conducted in accordance with law. On the basis of information given by Satinath Dhara, search was conducted at the premises of Ashok Bera i.e. M/s. Ankita Gold Workshop, however, no one from the 3 said premises was could be caught hold. From the information received from the accused persons and other connected persons, it was found that as per tax invoice No.SB-17948 dated 20.11.2021 issued by M/s. Sahlei Jeweleras of Shop No.126,127 Aakash Ganga, Supela Bhilai, Fine Gold amounting to Rs.50,52,150/- has been sold to M/s. Ankita Gold Workshop, however, without there being any material, the petitioner is being noticed, which is per se illegal. Since the entire action taken by the authorities are in contravention with Section 124 of the Customs Act, 1962, as such, the petitioner has filed this writ petition with the following reliefs:- “10.1 This Hon'ble Court may kindly be pleased to issue a direction to the issue a writ of mandamus or any other writ or direction in the nature of mandamus under Article 226 of the Constitution of India, after perusing the relevant documents in the matter and after examining the validity, propriety and legality of the same, quash and set aside the Show Cause Notice in F. No. DRI/IZU/RaRu/DI/Int-45/ENQ-22/2021 and DIN No. 2022.06.DDJ/32000055D73 and SCN No. Ad/IZU/scn-05/2022-23 dated 18.06.2022 issued by respondent no.1 in relation to the petitioner as being illegal, without any jurisdiction and authority of law. 10.2 This Hon'ble Court be pleased to issue a writ of mandamus or any other writ or direction in the nature of mandamus under 4 Article 226 of the Constitution of India, after perusing the relevant documents in the matter and after examining the validity, propriety and legality of the same, declare the adjudication proceedings likely to be conducted by the Respondent No. 3 as illegal and without any authority of law. 10.3 Any other relief or relief(s) which this Hon'ble Court may think proper in view of the facts and circumstances of the case may also kindly be granted.” 3. Learned counsel for the petitioner submits that the respondents authorities are predetermined against the petitioner while issuing the impugned show-cause notice dated 18.06.2022, in which the authorities have already expressed their views making liable to the petitioner for all the charges levelled against him. He further submits that the petitioner has been wrongly charged in the said show-cause notice and asked to reply to the charges mentioned in para 12.1 (ii) (iv) and (v) as the said charges do not pertain to the petitioner in any manner. It has been contended that the petitioner supplied 1000 grams (1 Kg) gold of purity 995 to Mr. Ashok Bera of M/s. Ankita Gold Workshop and the said gold was seized by the DRI from the possession of one Mr. Satinath Dhara working for M/s. Ankita gold Workshop. Thereafter, the petitioner had issued a bill in the normal course of its business in the name of M/s. Ankita Workshop dated 20.11.2021, wherein the purity is mentioned as 995 which was a bonafide mistake not corrected by 5 the accountant of the petitioner in printed invoice No.SB-17948 dated 20.11.2021 and the same was submitted by the petitioner on 13.06.2022, in which the purity is recorded 999. It has been further contended that there is no material even with the seizure of 1898 grams from the premises of M/s. Ankita Gold Workshop and the said charge is totally not sustainable as per law. It has been submitted that there is no reason for the petitioner to go through the trials and tribulations and ordeal of adjudication proceedings likely to be conducted by the Additional Commissioner of Customs, Indore. It has been further submitted that the petitioner was also arrested by the authorities concerned. From perusal of the notice, the involvement of the petitioner is nowhere mentioned, in spite of that, notice is being issued to the petitioner. The petitioner has categorically submitted that according to business term between he and M/s. Ankita Gold Workshop, the petitioner has issued a bill in a normal way of business and only on the basis of issuance of bill, it cannot be said that petitioner has been involved in smuggling etc. Since the entire action has been taken against the petitioner is illegal and arbitrary, issuance of show-cause notice itself is not in accordance with law. 4. On the other hand, learned counsel for the respondents submits that instant petition itself is not maintainable as the petitioner has come with this Court only on the basis of issuance of show-cause notice. He further submits that the petitioner should have replied 6 the notice along with documentary as well as oral evidence before the authorities concerned and in turn, the authorities could have appreciated before the concerned competent adjudicating authority. It has been contended that the show-cause notice dated 18.06.2022 was issued under adjudication before the competent adjudicating authority and the petitioner can very well raise all the issues before the adjudicating authority, who has jurisdiction to decide all the grievance raised by the petitioner, but the petitioner should not be allowed to bypass the statutory adjudicating authority. Reliance has been placed upon the judgment rendered by Division Bench of this Court in WPT No.190/2022 (Nathuram Surendra Kumar Jain v. Union of India and others), in which vide order dated 04.08.2022, the Court has denied to stay the proceedings of show-cause notice stating that against show- cause notice, the question for grant of stay of the effect and operation of the show notice does not arise. 5. Learned counsel for the respondents have further placed reliance upon the judgment rendered by High Court of Madhya Pradesh in Writ Petition No.137/2022 (Ashok P. Wagh v. Union of India and others) decided on 13.01.2022 to contend that instant writ petition is liable to be dismissed as the alternative and efficacious remedy was available to the petitioner. in the matter of raised several issues in this case. They have placed reliance of this judgment of this Court stated that petitioner has to avail alternative remedy available under the law. He has also placed reliance upon the 7 judgments rendered by Hon’ble Supreme Court in the matters of Trade Tax Officer, Saharanpur v. Royal Trading Co., (2005) 11 SCC 518, Union of India and another v. Knisetty Satyanarayana, (2006) 12 SCC 28, Indo Asahi Glass Co. Ltd. and another v. Income Tax Officer and others, (2002) 10 SCC 444, Special Director and another v. Mohd. Ghulam Ghouse and another, (2004) 3 SCC 440 and Commissioner of Income Tax, Gujarat v. Vijaybhai N. Chandrani, (2013) 14 SCC 661 as well as judgments rendered by Division Bench of this Court in the matters of Veer Bhadra Singh v. Union of India and others decided on 27.06.2019 in WPT No.94/2019 and M/s R.K. Associates and Hoteliers Pvt. Ltd. v. Union of India and others decided on 26.06.2019 in WPT No.22/2019, to buttress his submissions. 6. Learned counsel for the respondents also submits that the petitioner has rushed to the Court only on issuance of show-cause notice, therefore, the petition is liable to be dismissed at this stage as the petitioner can freely agitate his grievance before the authority before whom he has been given the opportunity of hearing and instead of placing the grievance before the Authority, he has come to the Court with this petition. 7. I have heard learned counsel for the parties, considered their rival contentions and perused the documents annexed along with writ petitions. 8 8. Perusal of the documents annexed with the writ petition, it goes to to show that primarily the show-cause notice issued to the petitioner is under challenge. A perusal of the said notice would show that preliminary submissions were made by the petitioner as well as his representative(s) and after consideration thereof, the notice under challenge was issued. The show-cause notice appears to have been issued after the initial reply. The details of notice purports that the averments of the petitioner was too considered and thereafter, he was given opportunity of hearing in person before adjudication of the case. The said notice further shows that the case is posted for hearing and the petitioner was given opportunity of being heard before any orders have been passed. The language of show cause notice would show that after preliminary consideration, the authority issuing the same came to a conclusion that the petitioner has willfully suppressed certain facts of rendering service provided to him. The show-cause further speaks that such facts came to fore when the investigation of records was carried out and after examination of records, the authority was of the opinion that suppression of facts exists. 9. According to the show-cause notice if suppression of certain facts exists, then in such background, the arguments of the petitioner that the writ petition would be required to be decided on admitted facts cannot be considered. The suppression destroys all the facts. If certain facts come to fore which were earlier suppressed, then the admitted facts become porous and new facts surface 9 which may require reconsideration. The attention that the issue has generated is predominantly on the mixed question of facts and law. If certain facts emerge which were under the veil, the entire dimension of an issue may be changed. 10. On the other hand, reading of show-cause notice would show that the authority issuing notice has reasonably acted upon and narrations have been made that why the authority has come to conclusion by recording such objective satisfaction of fact and has asked for the explanation by way of show cause. 11. The Supreme Court in the matter of Oryx Fisheries Private Limited v. Union of India, 2011 (266) E.L.T. 422 (SC), laid down the ratio that the person to whom the show cause notice has been issued must be told the charges against him at that stage. Here the show-cause notice would show that those charges of suppression have been arrived at after consideration of the preliminary submission. On the contrary, the subject show-cause notice gives an opportunity to rebut the allegations before Authority to prove their innocence which is also in conformity with the ratio of Oryx Fisheries Pvt. Ltd. (supra). Para 28 of the said judgment is relevant here and quoted below:- “28. It is no doubt true that at the stage of show cause, the person proceeded against must be told the charges against him so that he can take his defence and prove his innocence. It is obvious that at that stage the 10 authority issuing the charge sheet, cannot instead of telling him the charges, confront him with definite conclusion of his alleged guilt. If that is done, as has been done in this instant case, the entire proceeding initiated by the show cause notice gets vitiated by unfairness and bias and the subsequent proceeding become an idle ceremony.” 12. Further in the light of the ratio laid down in case of AVM Studio v. The Union of India (UOI) and others passed in W.A.Nos. 104 & 105 of 2008 and M.P.Nos.1 of 2008 decided on 11.03.2008 , the activities of the petitioner has been discussed in the show-cause notice. When the opportunity of hearing is given, it is well within the domain of the petitioner to explain the facts. Thereafter, after consideration of the reply, if the authorities come to a finding that such activity comes within the service of taxable net, then in such a case too that can be subject of challenge. The reiteration of word 'suppression' gives such analogy and if it is found that certain activities which were not disclosed and came to light after investigation then certainly the authorities have right to adjudicate and determine it. 13. At this stage, since the petitioner has been given opportunity of hearing, the prayer to quash the show-cause notice at the inception would amount to strangulate the issue which is yet to be adjudicated. The analogy of Siemen India Ltd. 2007 5 STR, therefore, would govern the situation that it would not be 11 appropriate to exercise the discretionary jurisdiction of writ and quash the show-cause notice by evaluating the language of it as primarily it does not show that it is without jurisdiction. Further, it would be wrong to hold that the authority issuing the show-cause notice has acted upon with premeditated mind. The language and narration made in the show-cause notice do not give such impression to quash the same at the inception. The petitioner has all the right to canvass his grievance before the adjudicating authority by whom he has been given notice to appear and explain their case. 14. Taking into consideration overall facts and circumstances of the case, this Court is of the opinion that as of now the petitioner is challenging the show-cause notice by way of writ petition wherein undisputedly, the petitioner is having remedy of appeal under Section 128 of the Customs Act and thereafter further remedy of appeal under Section 129 before the Customs, Excise and Service Tax Appellate Tribunal. All the grounds raised in this petition are available to the petitioner to be raised before the Appellate Authority. The Appellate Authority is competent to appreciate the technical grounds raised by the petitioner, therefore, this Court does not find any ground to interfere with the show cause notice under a writ petition filed under Article 226 of the Constitution of India. 15. In the result, the writ petition at this stage is premature and liable 12 to be dismissed for want of alternative and efficacious remedy of appeal. It is made clear that if the appeal is filed, any observation made herein-above shall not come in the way of the petitioner and Appellate Authority shall decide the appeal without being influenced by this order. 16. Accordingly, writ petition is dismissed, with the observation and direction as stated above. Sd/- (Amitendra Kishore Prasad) Judge Yogesh