M/S Sunflame Trading PVT. LTD. & Ors. vs. Commissioner, Central Excise And Central GST Comissionerate Delhi South

Facts

The petitioners, M/s Blue Star International Pvt. Ltd. & Ors., M/s Sunflame Trading Pvt. Ltd. & Ors., and M/s Atlantic International Trading Pvt. Ltd & Ors., filed contempt petitions alleging non-compliance by the Commissioner, Central Excise and Central GST, Delhi South. The petitioners claimed the respondent failed to provide duly endorsed copies of documents seized via a panchnama dated September 17, 2019, contravening a statement made before a Division Bench on November 22, 2022. The respondent, in its reply, stated the file pertaining to the seized documents was untraceable, with the officer who drew the panchnama having passed away and not handing over the file to his successor. Steps were taken to trace the file, including issuing a TRACER on October 14, 2022. The petitioners argued that the failure to disclose the TRACER issuance to the Division Bench on November 22, 2022, constituted contempt.

Held

The Court held that there was no wilful disobedience by the Respondent of the directions issued vide order dated 22.11.2022. The Court noted that the Petitioner(s) did not dispute that the directions concerning the cloning of data from digital devices seized during searches on September 17, 2020, and November 24, 2020, had been completed and handed over. Regarding the documents seized via the panchnama dated September 17, 2019, the Respondent placed on record its inability to furnish them, stating the file is untraceable and steps are being taken to trace it. In light of these circumstances, the Court was of the opinion that the Respondent's actions did not amount to wilful disobedience. Consequently, the contempt petitions were dismissed. The Court did not expressly leave any issue undecided.

Key Issues

1. Whether the Respondent has wilfully disobeyed the directions issued by the Division Bench of this Court vide order dated 22.11.2022, by failing to provide duly endorsed copies of documents seized vide panchnama dated 17.09.2019? Petitioner's Contention: The Respondent has committed contempt by failing to comply with the Division Bench's order and the statement made on 22.11.2022. The Petitioner argues that the Respondent should have informed the Division Bench about the TRACER issued on 14.10.2022 to trace the file, and by not doing so, and by failing to provide the documents, the Respondent has acted in contravention of the court's directions, constituting wilful disobedience. Respondent's Contention: The Respondent contends that there is no wilful disobedience. The file containing the seized documents is untraceable, and efforts are underway to locate it. The officer responsible for the file has passed away, and the file was not handed over to his successor. The Respondent has initiated steps to trace the file and is corresponding with DGGI (Hq.). Therefore, the inability to return the documents is due to these circumstances and not wilful non-compliance.