2010 (5) TMI 168 - HC - Customs

Released of seized goods - The petitioner sought release of goods pointing out that examination of goods had already taken place and there was no justification for seizure of the goods. It was also pointed out that detention of goods was resulting in demurrage charges Held that - We called upon the respondents to show the provision of law under which the goods were detained. It is not the case of the respondents in the reply or otherwise that power of seizure had been invoked as formation of satisfaction under Section 110 of the Act which is condition precedent for exercise of such power has not been shown. - Section 47 of the Act provides for clearance of goods on payment of duty unless goods are prohibited goods. It is not the case of the respondents that goods are prohibited goods. It is also not their case that duty assessed under section 17 or 18 has not been paid. In such a situation non clearance of goods may be justified for minimum period required for assessment. In no case non clearance of goods for months can be justified. Non clearance seriously affects rights of lawful importer and fair procedure being constitutional mandate no authority can plead unlimited power of non clearance for its own incompetence as a justification beyond reasonable period officers of customs department are not immune from accountability against abuse of power by detaining goods for indefinite period on the ground that they were in the process of checking the value or nature of goods.

Summary

Issues:
Validity of detention of goods by the custom authorities.

Analysis:
1. Background: The judgment addresses two petitions, CWP Nos. 5248 and 5254 of 2010, involving the identical issue of the validity of the detention of goods by the custom authorities.

2. Petitioner's Case: The petitioner imported Processed Distillate Oil and filed a Bill of Entry under the Customs Act, seeking clearance for home consumption. Despite physical verification and correspondence, the goods were seized between 12.3.2010 to 19.3.2010. The petitioner argued that the detention was unjustified, causing demurrage charges, and cited instructions for timely examination and release of goods.

3. Identical Facts: The facts in CWP No. 5254 of 2010 mirrored those in CWP No. 5248 of 2010.

4. Respondents' Stand: The Directorate of Revenue Intelligence stated that the goods were detained on 23.2.2010 and could be kept in a bonded warehouse under the Act.

5. Court's Evaluation: After hearing both parties, the court considered the prolonged detention of goods for about three months. The petitioner argued that the seizure lacked valid justification and violated statutory safeguards. The court emphasized that the power of seizure should not be misused without prima facie evidence or following due process.

6. Legal Precedents: The judgment referred to legal precedents highlighting the balance between the state's power of search and seizure and an individual's rights to property and privacy. It emphasized that the procedure for seizure must be fair and reasonable, ensuring accountability and adherence to legal requirements.

7. Court's Decision: The court found that the respondents failed to justify the continued detention of goods. It ruled in favor of the petitioners, directing the immediate release of goods subject to duty payment, without prejudice to the respondents' statutory rights.

8. Conclusion: The judgment underscores the importance of balancing state powers with individual rights, emphasizing accountability and adherence to legal procedures in cases of detention and seizure of goods by custom authorities.

This detailed analysis of the judgment highlights the court's considerations, legal interpretations, and ultimate decision regarding the validity of the detention of goods by the custom authorities.