2012 (2) TMI 607 - HC - Customs

Detention and seizure of betel nuts - the impugned order was shown to have been made on 07.06.2011 at 18.00 hrs. although the trucks and their drivers were detained on 06.06.2011 itself while the drivers had parked their trucks at the Petrol Pump for taking tea but the said trucks and drivers were produced before the Magistrate on 09.06.2011 - Held that - The documents on record clearly show that the petitioner was not only the consignor but also the transporter of articles in question arranging the trucks from Mandies for reaching betel nuts to their destinations namely to the consignee - this court has no option but to come to the conclusion that the impugned order of detention and seizure of betel nuts and the trucks on which it was loaded are illegal arbitrary and perverse. Furthermore the impugned confiscation notice dated 18.11.2011 issued u/s 124 of the Act during the pendency of this writ petition is based merely on the aforesaid seizure which has already been held to be illegal arbitrary and perverse and hence when the base namely the seizure goes every structure thereon including the confiscation notice also will have to follow - petition allowed - decided in favor of petitioner.

Issues Involved:
1. Legality of the seizure memo dated 07.06.2011.
2. Validity of the "reason to believe" for the seizure.
3. Legality of the detention of drivers and their statements.
4. Validity of the show-cause notice dated 18.11.2011.
5. Locus standi of the petitioner to file the writ petition.

Detailed Analysis:

1. Legality of the Seizure Memo Dated 07.06.2011:
The petitioner challenged the seizure of 29,336 Kgs. of betel nuts and two trucks under Section 110 of the Customs Act, 1962, for alleged violations of notifications issued under Section 11 of the Act. The petitioner contended that the seizure was made without any material or "reason to believe" and was thus illegal. The court noted that the respondents failed to produce any documents or materials justifying the seizure. The court held that the seizure was arbitrary and not sustainable in law.

2. Validity of the "Reason to Believe" for the Seizure:
The petitioner argued that there was no "reason to believe" at the time of seizure, as required by law. The court referred to previous judgments, including Angou Golmei & Ors. v. The Union of India and Shiv Kumar Bhagat v. The State of Bihar, which emphasized that the "reason to believe" must be based on concrete material. The court found that the respondents acted on mere suspicion without any substantial evidence, thus failing to meet the legal requirement of "reasonable belief."

3. Legality of the Detention of Drivers and Their Statements:
The court observed that the drivers were detained on 06.06.2011 and produced before the magistrate on 09.06.2011, exceeding the permissible detention period. This was a violation of Sections 108 and 138-B of the Customs Act, which aim to prevent extortion of confessions. The court cited Noor Aga v. State of Punjab, holding that the detention and subsequent statements of the drivers were not legal and proper.

4. Validity of the Show-Cause Notice Dated 18.11.2011:
The petitioner challenged the show-cause notice issued during the pendency of the writ petition. The court noted that the notice was given to circumvent Section 110 (2) of the Customs Act, which mandates the return of goods if no notice is issued within six months of seizure. The court held that since the seizure itself was illegal, the show-cause notice based on it was also invalid.

5. Locus Standi of the Petitioner to File the Writ Petition:
The respondents argued that the petitioner, being merely a transporter, had no locus standi. However, the court found that the petitioner was both the consignor and transporter, with valid documents proving its business operations. The court held that the petitioner was the main aggrieved party and had the right to file the writ petition.

Conclusion:
The court concluded that the seizure and detention of the betel nuts and trucks were illegal, arbitrary, and perverse. Consequently, the show-cause notice issued during the pendency of the writ petition was also invalid. The court directed the authorities to release the seized goods and trucks immediately to the petitioner.

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