Punjab HC orders CBI Inquiry to fix liability of erring Customs Dept on clearing consignment without making any Entry


In Sunil Dutt v. Department of Customs, Commissionerate, Ludhiana [CRM-M-42144-2021 (O&M) dated October 13, 2021], the Honorable Punjab and Haryana High Court (“the Punjab HC”) initiated Central Bureau of Investigation (CBI) enquiry to fix liability of erring Customs Department and Anti Evasion Goods and Services Tax (GST) Units in respect of clearing of Consignment without making any entry.

In the instant case, Sunil Dutt (“the Petitioner”) has filed a second Petition seeking grant of anticipatory bail in Complaint Case for the offences under Sections 135, 135-A, and 132 of the Customs Act, 1962.

The Petitioner is a registered informer of General GST, Commissionerate (“the Respondent”), and has helped in unearthing many scams and GST Evasion for which he has been granted the award. The Petitioner is enrolled as a G-Card Holder by the Department of Customs on behalf of M/s. Safe Cargo Clearing Services and being a G-Card Holder, the Petitioner is assisting in moving the files of the parties in the Department of Customs for handling the custom clearances and has also obtained a KYC Form, Import-Export Code, PAN Card, Aadhar Card, etc. from one Prabhjot Singh.

The Petitioner has argued that he has initially given the information to GST Department regarding a consignment which was illegally cleared by the Customs Department without making any entry and the same was intercepted by Preventive Wing of CGST Commissionerate, Ludhiana and it was found that the shipping line seal of the container was intact and not broken which suggested that the Customs Authorities never checked the consignment.

When the consignment was checked by the Preventive Wing of CGST Commissionerate, Ludhiana, it was found containing 39,60,000 Cigarettes (100 mm each) of four different brands, 10030 Kgs of iron scrap, and 04 alloy wheels. The Petitioner further submitted that he was apprehensive that since he has unearthed a scam, he may fell to the anger of the Customs Department as the Custom Official, who was the Port In-charge when the consignment was allowed to move out of the Port without making any entry, is now made the Head of the Special Investigative Team.

After taking perusal of all the facts and evidences, the Punjab HC noted that it is very strange that Department of Customs, Customs Commissionerate, Ludhiana and Anti-Evasion Unit, Central Goods & Services Tax, Commissionerate, Ludhiana, are fighting regarding fixing the liability as to how the consignment was cleared manually without making any entry by the Customs Department.

The Honorable court said, “The officers of Customs Department, as well as the CGST Department, derive their powers from the respective Customs Act, 1962 and the Central Goods and Services Act, 2017 and both Departments are part of premium investigating agencies, however, instead of fighting and levelling allegations against each other, the office of the Director-General of both the Departments should have intervened and settled the dispute. Therefore, taking note of the tardy, casual and irresponsible attitude of both the departments, I find it to be a fit case where the matter needs to be referred to the Central Bureau of Investigation (CBI) for conducting further investigation of the case and fix liability of the erring official(s).”

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