TMI Blog2019 (10) TMI 114X X X X Extracts X X X X X X X X Extracts X X X X ..... ation is over and the respondents receive a report as regards the country of origin from an accredited lab within a period of three months by following the established procedures. In the present case, the samples of Betel Nuts are in damaged condition with presence of insects. These are thus, unsafe for human consumption. Other unifications are still going on. The petitioner no. 1 is, thus, unable to make out a case for direction to release the Betel Nuts. Release of vehicle - HELD THAT:- It will be open for petitioner no. 2 to make an appropriate application before the competent authority who will consider the same and pass an appropriate order thereon within a period of 30 days from the date of filing of the application. Application disposed off. - Civil Writ Jurisdiction Case No.6563 of 2019 - - - Dated:- 5-9-2019 - Mr. Justice Rajeev Ranjan Prasad For the Petitioner/s : Mr.Amit Pandey, Advocate For the Respondent/s : Mr.S.D. Sanjay (Addl. Solicitor General) C.A.V. JUDGMENT Heard Mr. Amit Pandey, learned counsel for the petitioner and Mr. S. D. Sanjay, learned counsel for the Union of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 11 of the Customs Act read with Section 3(2) of the Foreign Trade (Development and Regulation) Act, 1992. The notification prohibits the imports of goods from Nepal which has been exported to Nepal from other country in India. 5. Learned counsel assailed the seizure on the ground that seizure of goods and conveyance has been done without having any reason to believe that the conveyance was carrying on any smuggled goods or the impugned goods were in any way liable for confiscation under the Customs Act, 1962. He has referred Section 106 of the Customs Act, 1962 to show that the power for search of conveyance would be available only in case the proper officer has reason to believe that any vehicle is being used in the smuggling of any goods and in the carrying of any goods which has been smuggled. It is submitted that the respondent authorities have asserted that they had specific information received from their Additional Commissioner over telephone that the Betel Nuts of third country or origin were being transported from Gauhati to Karnataka and getting upon the said information the Truck was intercepted. It is submitted that there was no authentic in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es have not been followed. Thus, the entire procedure is without authority. 9. As regards the reliance placed upon Circular No. 03 of 2011 of the Customs dated 06.01.2011 and Circular No. 58/2011- Customs Dated 25.10.2001 it is contended that these circulars are applicable to imported goods prior to custom clearance. The submission is that in the instant case there is neither any belief to show that the impugned goods are smuggled or imported nor there is anything to show that the respondent authorities had any jurisdiction to cause customs clearance of the said goods. 10. Learned counsel further relied upon the judgment of this Court in the case of Salsar Transport Company Vs. The Union of India in M.J.C. No. 2185 of 2013 vide order dated 24.07.2013. 11. On the other hand learned counsel for the Union of India has contested the writ application on the various grounds which have been taken note of by this Court in detail while considering the connected writ application bearing C.W.J.C. No. 10109 of 2019. The contention of the learned counsel for the Union of India has been discusse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... After hearing the learned counsel for the petitioner and learned counsel representing the Union of India, this Court finds that the submissions of learned counsel for the parties are identical to the submissions raised in C.W.J.C. No. 10109 of 2019 which has been disposed of today itself. The consideration and operative part of the judgment in C.W.J.C. No. 10109 of 2019 are quoted hereunder: 20. Having heard learned counsel for the petitioner as well as for the Union of India, this Court finds that the whole argument of the petitioner for purpose of quashing of the seizure list revolves around the provision of Section 110 of the Customs Act. Section 110 of the Customs Act is quoted hereunder for a ready reference: 110. Seizure of goods, documents and things . -(1) If the proper officer has reason to believe that any goods are liable to confiscation under this Act, he may seize such goods : Provided that where it is not practicable to seize any such goods, the proper officer may serve on the owner of the goods an order that he shall not remove, part with, or otherwise deal with the goods except with the previ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng under this Act. (4) The person from whose custody any documents are seized under sub-section (3) shall be entitled to make copies thereof or take extracts therefrom in the presence of an officer of customs. 2 [ 110-A. Provisional release of goods, documents and things seized pending adjudication. - Any goods, documents, or things seized under section 110, pending the order of the 3[adjudicating authority], be released to the owner on taking a bond from him in the proper form with such security and conditions as the 3[adjudicating authority] may require.] 21. In the facts of the present case, the counter affidavit of the respondents states that the Cut Dried Arecanuts is of dark pink colour which are not the characteristics of Indian origin Arecanuts because the Arecanuts of Indian origin are normally Oval in shape. In order to ascertain the country of origin of the seized cut dried Arecanuts, samples were sent to the two Laboratories. The test report of ARDF, Mangalore reads as under: The sample of areca nuts contain very small cut pieces (Chips), boiled, dried and coated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been rejected on a totally different ground. In paragraph 26 of the counter affidavit respondents have come out with the following statements: 26. That in the view of the statements made in paragraph no. 48, 49, 50, 51, 52, 53, 54, 55, 56, 57, 58, 59, 60, 61, 62, 63, 64, 65, 66, 67 and 68 of the writ petition under reply, it is humbly stated and submitted that it is pertinent to mention that facts and circumstance of the instant case are not identical to the facts and circumstances for the cases referred by the petitioner in his application. In the instant case respondent has placed reliance upon the test report given by the two test labs, in which it has been reported that the sample is unsafe food for human consumption; while in any of the cases referred by the petitioner no such report was available at that point of time. In view of the same it would not be appropriate to release the seized goods for human consumption. 27. Learned counsel for the Union of India has placed before this Court a Government of India s Circular No. 3 of 2011 issued by Ministry of Finance in the Department of Revenue, Central Board of Excise and Customs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. To consolidate the laws relating to food and to provide for a systematic and scientific development of Food Processing Industries, the government has enacted The Food Safety and Standards Act, 2006 (FSS Act, 2006). Under the Act, the Food Safety and Standards Authority of India (FSSAI) has been established to lay down standards and regulate/monitor the manufacturing, import, processing, distribution and sale of food. Section 97 of the FSS Act, 2006 provides that the existing Acts and Orders relating to food items such as PFA Act, 1954; Food Products Order, 1955; Meat Food Products Order, 1973; Vegetable Oil Products (Control) Order, 1947; Edible Oils Packaging (Regulation) Order, 1988; Solvent Extracted Oil, Deoiled Meal, and Edible Flour Control (Order), 1967; Milk and Milk Products Order, 1992 etc shall be repealed from a date to be notified. 4. The FSSAI has taken over PHO functions at select ports such as Nava Sheva and Mumbai with effect from 13.09.2010 with the stipulation that the existing rule and procedures will continue to be followed without any change till FSSAI regulations are notified. Thus, FSSAI has replaced PHO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the importers as well as information received from FSSAI from time to time. (iii In case, a sample drawn from a food item in a particular consignment fails to meet the prescribed standards, the Customs would place the import of the said consignment on alert, discontinue random checking for import of such food items and revert to the procedure of compulsory checking. The system of random sampling for import of such food items would be restored only if the test results of the samples drawn from the 5 consecutive consignments re-establish that the food items are in conformity with the prescribed standards. 8.Authorised Officers of FSSAI will ascertain that for the imported pre-packaged good items, the language and other major requirements of the label like mention of best before date, nutrition information etc. should comply the labeling provisions under PFA Rules, failing which sample may not be drawn from such consignment for testing. 9.It is also clarified that Risk Management System (RMS) module for import consignments of edible / food items, presently does not provide for random sampling as it is one of its CCR (Compulsory Cus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... supplier and item of import do not change. In other words, if such a shipment is imported say, at Mumbai and the previous 5 shipments imported at, say, Delhi have passed the test, then the next shipment at Mumbai need not be tested. A suitable data base would also be prepared at each Custom House to indicate the compliance history of importers. 13. The Board Circular 58/2001-Cus dated 25.10.2001 stands modified to above extent. 14. These instructions may be brought to the notice of all concerned by way of issuance of suitable Public Notice / Standing Order. 15. Difficulties, if any, in implementation of these instructions may be brought to the notice of the Board Yours faithfully, ( R. P. Singh ) Director (Customs) 28. Learned counsel for the Union of India, Department of Customs and Excise placed before this Court a Circular No. 35 of 2017 dated 16th August, 2017 which provides guidelines for provisional release of seized imported goods pending adjudication under Section 110 A of the Customs Act, 1962. The relevant part of the guidelines as contained in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d Gallery Pvt. Ltd. Vs Additional Director General, DRI, Chennai Ors. Wherein the Hon ble Court has given sufficient discretion to the adjudicating authority to deny provisional release of goods in any case where the goods are smuggled or import is treated as illegal and in violation of the statutory provisions. In terms of the said judgment, by specifying the relevance and reason, the adjudicating authority may deny provisional release of any goods which are liable to confiscation under Section 111 or Section 113 as they would fall under the definition of prohibited goods, in terms of Section 2(33) of the Customs Act, 1962. 29. Further learned counsel has placed before this Court the information issued by the Director (Imports) of the Food Safety Standards Authority of India (Statutory Authority established under the Food Safety and Standards Act, 2006) which reads as under : File No.1-1600/FSSAI/Imports/2016 (Part18) Food Safety and Standards Authority of India (A Statutory Authority established under the Food Safety and Standards Act, 2006) FDA Bhawan, Kotla road, New Delhi-110002 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uidelines for re-testing of samples- reg. World Trade Organization (WTO) negotiated Trade Facilitation Agreement (TFA),which aims at simplifying the trade processes and bringing down barriers to trade has come into force w.e.f 22nd February, 2017. India is a signatory to this agreement. 2) India has placed a number of trade related measures negotiated under the TFA in Category A. Article 5.3.1 envisages granting an opportunity for a second test in case the first test result of a sampletaken upon arrival of goods declared for importation shows an adverse finding. Further Article 5.3.3makes it obligatory to consider the result of the second test, if any, for the release and clearance of goods, and, if appropriate, may accept the results of such test. The aforementioned Articles have been placed incategory A. In order to have uniformity in approach among the field formations with regard to re-testing of samples, the following procedure is prescribed: a. Customs officers may draw the samples from import consignments for testing in case of consignments wherever needed. The results of all test reports, adverse or otherwise, shall be comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... test and re-test results. g. The facility of re-testing, is a trade facilitation measure, which should generally not be denied in the ordinary course. However, there might arise circumstances where the customs officer is constrained to deny the re-testing facility. Board expects that such denial would be occasional and on reasonable grounds to be recorded in writing. h. Where the re-testing procedure is done at the instance of the department instead of the importer, the above procedure shall be followed mutatis mutandis.3) Difficulties, if any, in implementation of this circular, should be brought to the notice of the Board.4) Hindi version of the circular will follow. Yours faithfully (Zubair Riaz) Director (customs) 31. In the aforesaid background the latest development has come vide office Memorandum Dated 4th June, 2019 issued by the Government of India in its Ministry of Commerce and Industry, Department for Promotion and Industry and Internal Trade, the office Memorandum reads as under No. 12013/14/2019/NPC-QCI Government of Ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n taken out and subjected to analysis under the provisions of the Food and Safety and Analysis Rules and Regulations. The learned Writ Court took a view that the Betel Nuts are raw materials which requires sufficient processing to be done and only thereafter, this would be packaged in terms of the provisions of the Food Safety and Standards (Packing and lebelling) Regulations 2011 for being put up for sale. The learned Writ Court took a view that the stage had not come into existence when the sample was sent by custom authorities to the CFL , Kolkata (Extension Center, Raxaul). 33. As is evident from the discussions made in the judgment dated 24.07.2013 passed in M.J.C. No. 2185 of 2013, learned Writ Court hearing the modification application was not apprised of the fact that all consignment of high risk food items are liable to be referred to authorized representative of FSSAI or PHOs as the case may be for testing and clearance for testing and clearance can be allowed only after testing report as per the instructions contained in the Custom Circular No. 58/2001 dated 25.10.2001 (referred the Circular No. 3/11). The Court was also not informed that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that the aforesaid materials were not brought before the learned Writ Court in the case of Salsar Transport Company (supra), the said decision cannot be applied on the face of the materials which have been placed before this Court in the present case. Nothing has been brought to show that the very sampling and testing of the Areca Nut was not in accordance with law. 36. The another submission of learned counsel for the petitioners that there cannot be a refusal to provisionally release the goods on the grounds stated in Annexure 4 to the writ application is also not acceptable to this Court. The Court has taken note of the detail guidelines issued by the Department of Customs to streamline the divergent procedures being followed for grant of provisional release of the goods which are seized under Section 110 of the Customs Act, 1962. The provisional release of the seized goods is to be refused when the goods do not fulfill the statutory compliance requirements of any Act, Rule, Regulation or any other law for the time being enforced. 37. In the present case, since the Food Laboratory Report has found that the Betel Nut are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Learned counsel for the Union of India, Department of Customs has submitted that the developments so far may persuade this Court not to interfere with the seizure at this stage when the matter is still under investigation and a complete view may be taken as regards the foreign origin after obtaining a report from the accredited lab. 41. This Court is of the considered opinion that in the given facts and circumstances of the case, where the matter is still under investigation and even some accredited labs have come into existence, this Court need not interfere with the seizure of the Betel Nuts at this stage and this issue be kept open for consideration at appropriate stage after the investigation is over and the respondents receive a report as regards the country of origin from an accredited lab within a period of three months by following the established procedures. 42. In result, this Court finds no reason to interfere with the impugned orders. The writ application has no merit. It is dismissed accordingly. 13. The ratio of the above-quoted judgment would fully apply in the facts ..... X X X X Extracts X X X X X X X X Extracts X X X X
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