Separate show-cause notices retain independent legal identities despite common investigation and joint adjudication.

The Petitioners imported and traded signage materials from China and Taiwan. In 2016, the Directorate of Revenue Intelligence (“DRI”) initiated an investigation alleging misdeclaration and undervaluation of imported goods; searches were conducted, statements were recorded, and certain goods were seized and provisionally released on bond and bank guarantee.

The investigation resulted in two show-cause notices. The First SCN, dated 27 March 2017, concerned the seized goods and proposed confiscation and penalties. The Second SCN, dated 11 May 2020, concerned earlier imports and proposed recovery of customs duty, interest and penalty under Section 28 of the Customs Act, 1962.

Both matters were assigned to the same adjudicating authority on 13 October 2020 and were heard together.

The Petitioners alleged non-supply of relied-upon documents and denial of effective hearing, while the Respondents maintained that several opportunities had been granted and that the Petitioners had repeatedly sought adjournments.

Following Canon India Pvt. Ltd. v. Commissioner of Customs , the matters were placed in the Call Book pursuant to a CBIC instruction dated 17 March 2021. The Respondents subsequently relied on the Finance Act, 2022, Section 28(9A), and an extension granted on 6 March 2023 to justify continuation of the adjudication proceedings.

The Petitioners filed W.P.(C) 16149/2023 challenging continuation of proceedings under the Second SCN. On 14 December 2023, the High Court stayed further proceedings pursuant to that SCN.

Despite the stay, the adjudicating authority passed an Order-in-Original dated 1 February 2024 concerning the First SCN, leading to W.P.(C) 5024/2024.

1. Whether the adjudication of the First SCN was impermissible merely because the First and Second SCNs arose from the same investigation, were assigned to the same authority, and proceedings under the Second SCN had been stayed?

2. Whether the Order-in-Original concerning the First SCN should be interfered with under Article 226 on the grounds of alleged non-supply of relied-upon documents, denial of effective hearing, and violation of natural justice?

3. Whether the proceedings under the Second SCN had become time-barred under Section 28(9) of the Customs Act, including in light of the Call Book mechanism, Section 28(9A), the extension dated 6 March 2023, and the alleged non-communication of that extension?

The Court applied the principle that separate show-cause notices, even when arising from the same investigation and heard by a common adjudicating authority, retain their independent statutory identity unless the statute requires a composite adjudication.

An interim order must be construed according to its express terms and cannot be enlarged by implication; the stay of proceedings under one SCN did not automatically extend to another independent SCN.

The Court further applied the doctrine that writ jurisdiction under Article 226 is ordinarily not exercised where an effective and efficacious statutory appellate remedy exists, particularly when the disputed issues involve appreciation of evidence, alleged breach of natural justice, and examination of the adjudication record.

The Court considered, but expressly declined to decide, the interpretation and effect of Sections 28(9) and 28(9A) of the Customs Act, the Call Book mechanism, the extension dated 6 March 2023, and the precedents relied upon by the parties, including Canon India , Pranij Heights India Pvt. Ltd. , Shri Ram Agro Chemicals Pvt. Ltd. , and Vos Technologies India Pvt. Ltd.

The Court held that the First and Second SCNs related to different subject matters and had independent statutory foundations: the First SCN concerned confiscation of seized goods, whereas the Second SCN concerned recovery of customs duty, interest and penalty on earlier imports.

Consequently, their common origin, common adjudicating authority, and joint hearing were matters of administrative convenience and did not convert them into one composite proceeding.

Since the interim order dated 14 December 2023 expressly stayed only proceedings pursuant to the Second SCN, it did not restrain adjudication of the First SCN.

As to the challenge to the Order-in-Original, the Court found that the allegations concerning non-supply of documents, denial of hearing, justification for adjournments, and resulting prejudice required examination of the adjudication record.

Those matters could be fully considered by the CESTAT in statutory appeal, and no exceptional circumstance justified bypassing that remedy under Article 226.

Regarding the Second SCN, the Court declined to adjudicate the limitation and Section 28 questions because the adjudication proceedings had not yet attained finality and any findings could prejudice the adjudicating authority’s decision.

It held that the stay granted on 14 December 2023 did not prohibit adjudication of the First SCN.

W.P.(C) 16149/2023 was also disposed of. The interim stay was vacated, and the Respondents were permitted to proceed with adjudication of the Second SCN.

Before passing any final order, the adjudicating authority was directed to provide the Petitioners an effective opportunity of hearing and comply with the principles of natural justice.

All questions concerning Section 28, the Call Book, the extension dated 6 March 2023, communication of that extension, and the alleged non-supply of relied-upon documents were expressly kept open.