2025 (6) TMI 616 - HC - Customs

Seizure of the consignments of buffalo meat which were proposed to be exported to a foreign country - misdeclaration by the consignor - goods prohibited to be exported - HELD THAT - It is ordered that the competent officer of the Customs shall ensure that the adjudication process is completed by following the statutory procedure contemplated in this regard including hearing of the affected parties as expeditiously as possible at any rate within a period of two months from the date of receipt of a copy of this judgment. As regards the disposal of the articles is concerned it is ordered that the same shall be completed by following the procedure within a period of one month from the date of receipt of a copy of this judgment. Petition disposed off.

Summary

The core legal questions considered by the Court in these writ petitions relate primarily to the seizure, adjudication, and disposal of consignments of buffalo meat proposed for export, which were found to contain prohibited items due to misdeclaration by the consignor. The issues include: (1) the legality and procedural correctness of the seizure and subsequent confiscation proceedings initiated by the Customs authorities; (2) the rights of the consignors and carriers pending adjudication, specifically concerning the detention of perishable goods and export containers; (3) the appropriate timeframe and procedure for completing adjudication and disposal of the seized goods; and (4) the release of containers to the carrier following disposal of the goods.

Regarding the first issue, the seizure of the consignments was effected under statutory authority upon discovery of misdeclaration and presence of prohibited items. The relevant legal framework includes Customs laws and regulations governing export controls, seizure, and confiscation of prohibited goods. The Court examined whether the authorities followed due process in issuing notices for seizure (Ext.P2 and Ext.P3) and initiating confiscation proceedings. The Court found that the seizure was lawful, supported by evidence of misdeclaration, and that the notices issued were in accordance with procedural requirements. The consignors' challenge to the seizure notices did not dispute the factual basis but rather sought expedited adjudication and relief from pending disposal notices.

The second issue concerns the rights and interests of the consignors and the carrier during the pendency of adjudication. The consignors filed writ petitions challenging notices proposing disposal of the seized consignments (Ext.P6 and Ext.P7), while the carrier petitioned for release of export containers detained due to delay in adjudication. The Court considered the perishable nature of the goods, emphasizing the necessity for expeditious disposal to prevent loss. The Court noted submissions from the Customs Standing Counsel assuring completion of adjudication and disposal within a stipulated timeframe. The consignors did not oppose disposal following due procedure and expressed no objection to the disposal notices, indicating acquiescence to the process.

In analyzing the third issue, the Court underscored the statutory procedure for adjudication and disposal under Customs laws, which includes hearing affected parties before final orders. The Court directed that the adjudication process be completed within two months from the judgment date, ensuring procedural fairness and compliance with statutory mandates. Disposal of the perishable articles was ordered to be completed within one month, reflecting the Court's recognition of the need to balance legal process with practical considerations related to the nature of the goods.

The fourth issue involved the release of export containers to the carrier after disposal of the goods. The Court acknowledged the carrier's grievance regarding prolonged detention of containers, which caused hardship. To address this, the Court ordered release of the containers within ten days of disposal, thereby protecting the carrier's property rights and facilitating commercial logistics.

The Court's reasoning reflects a careful balancing of statutory authority vested in Customs to regulate exports and seize prohibited goods, with the rights of consignors and carriers to fair procedure and timely resolution. The Court emphasized adherence to the statutory framework, including notices, hearings, and timelines, while ensuring that perishable goods are not unduly held, which could result in loss or damage. The Court's directions aim to expedite the process without compromising procedural safeguards.

Competing arguments were treated with due consideration. The consignors' challenge to disposal notices was effectively withdrawn, enabling the Court to permit disposal under the prescribed procedure. The Customs authorities' commitment to adhere to timelines was accepted, and the carrier's concern over container detention was addressed through specific release directives. The Court avoided any substantive interference with the seizure or confiscation process, focusing instead on procedural expediency and fairness.

The significant holdings of the Court include the following:

"The competent officer of the Customs shall ensure that the adjudication process is completed, by following the statutory procedure contemplated in this regard, including hearing of the affected parties, as expeditiously as possible, at any rate within a period of two months from the date of receipt of a copy of this judgment."

"As regards the disposal of the articles, the same shall be completed by following the procedure, within a period of one month from the date of receipt of a copy of this judgment."

"On disposal of the properties as referred to above, the containers shall be released to the petitioner in W.P(C) No.7930/2025 within a period of ten days from the date of such sale."

These directives establish core principles that while Customs authorities have the power to seize and confiscate prohibited export goods, they must do so in accordance with statutory procedures, ensuring affected parties are heard and adjudications are completed within a reasonable and expeditious timeframe. The Court also recognizes the commercial realities associated with perishable goods and the importance of releasing detained containers promptly after disposal to avoid undue hardship.

In conclusion, the Court upheld the seizure and confiscation proceedings as lawful but mandated strict adherence to procedural safeguards and timelines. The consignors' and carrier's interests were balanced by allowing disposal under due process and ensuring timely release of containers. The judgment thus reinforces the procedural framework governing Customs seizures and confiscations while emphasizing expeditious resolution, particularly in cases involving perishable goods.