The present petition arose from a challenge to the Order-in-Original dated 5 October 2017, issued after adjudication of a show cause notice dated 18 December 2014. The petitioner contended that DRI officers lacked jurisdiction to issue the show cause notice, citing the decision in Canon India as the primary ground. The petitioner also challenged the validity of Note 3 in Notification No. 125/2010/Cus dated 16 December 2010, arguing that it was ultra vires the provisions of the Customs Act, 1962, and the Customs Tariff Act, 1975.

The case had been kept pending due to the filing of a review petition before the Supreme Court, which sought to revisit the earlier decision in Canon India.

The Supreme Court disposed of the review petition on 7 November 2024, with a detailed order clarifying the jurisdictional issues regarding DRI officers. The Court reviewed the earlier decision in Canon India and addressed several legal aspects that were not considered at the time.

Jurisdiction of DRI Officers: The Court held that DRI officers are indeed "proper officers" under the Customs Act, 1962, authorized to issue show cause notices. This was supported by the provisions of Circular No. 4/99-Cus dated 15 February 1999, and Notification No. 44/2011-Cus dated 6 July 2011, which empowered DRI officers to issue such notices. The earlier judgment in Canon India was criticized for not considering these circulars and notifications.

Clarification of the Legal Framework: The decision also emphasized the statutory provisions of Sections 2(34) and 5 of the Customs Act, 1962, which deal with the appointment and jurisdiction of customs officers, particularly in relation to the issuance of show cause notices under Section 28. The earlier Canon India decision had incorrectly excluded DRI officers from this jurisdiction, leading to the current clarification.

Implications of the Finance Act, 2022: The Court upheld the constitutional validity of Section 97 of the Finance Act, 2022, which retrospectively validated all show cause notices issued under Section 28, including those issued by DRI officers. The Court found that this amendment effectively cured the defects identified in the Canon India decision.

Impact on Pending Cases: The Court provided specific directions for handling cases where the jurisdiction of the DRI officers to issue show cause notices had been questioned. These cases are to be reconsidered in light of the new ruling, and show cause notices previously challenged on jurisdictional grounds are to be restored for adjudication.

In the present petition, the Court noted that the petitioner had already filed an appeal against the Order-in-Original dated 5 October 2017. The Court directed the Appellate Authority to proceed with the appeal in accordance with the law, reaffirming the jurisdiction of DRI officers.

As for the challenge to Note 3 in the Notification No. 125/2010/Cus, the Court clarified that this issue had already been raised in Writ Petition No. 3079 of 2014, which had been dismissed with the liberty to challenge the validity of Note 3 in appropriate proceedings. Therefore, the challenge to Note 3 was kept open for future consideration, with the petitioner free to pursue the matter in relevant forums.

The Supreme Court's 2024 ruling has significant implications for the jurisdiction of DRI officers in issuing show cause notices under the Customs Act, 1962. By affirming the authority of these officers, the Court has resolved key legal ambiguities that arose from its earlier judgment in Canon India. This decision not only provides clarity on the role of DRI officers but also reaffirms the constitutional validity of certain statutory amendments, particularly the retrospective validation of show cause notices under Section 28.

As the case moves forward, the petitioner, along with other stakeholders, will now have an opportunity to address any remaining challenges before the appropriate appellate authorities. The decision also sets a precedent for similar cases, ensuring that customs officers across the board can effectively exercise their jurisdiction in matters related to the recovery of duties.