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TMI Blog2019 (10) TMI 114X X X X Extracts X X X X X X X X Extracts X X X X ..... it's value as the seized goods is a perishable goods; And/or iii) To issue a writ in the nature of Certiorari for quashing the Seizure Order / Seizure Memo dated 06.02.2019 whereby and where under 20,650 Kgs. of Betel Nuts (Arecanuts) as evaluated at Rs. 58,76,577/- and a truck bearing Registration No. TN 25 BC/5209 as evaluated at Rs. 23,64,000/- was seized on 06.02.2019 and all consequential proceedings in pursuance of same' And/or iv) To grant any other relief or reliefs to which the petitioners are entitled in the facts and circumstances of the case." 3. The case of the petitioner is that the petitioner no. 1 is engaged in business of trade of Betel Nuts grown in North Eastern Region of the country and the petitioner no. 2 is Transporter of goods. On 06.02.2019 when a vehicle bearing Registration No. TN 25 BC / 5330 engaged by petitioner no. 2 for carrying the Betel Nuts of petitioner no. 1, it was detained by the officials of the Customs, Forbesganj under the office of the Commissioner of Customs (Prev), Patna near Bhabtiyahi towards Kosi Mahasetu and seized the Betel Nuts approximately 20,650 kg valued at Rs. 58,76,577/- and the truck in question. A seizure memo was pre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. Further it is submitted that even samples sent by the respondent authorities to 'ADRF' have failed to determine it's country of origin. In this regard learned counsel refers Annexure 'R/4' and 'R/5' to the counter affidavit. 7. Further relying upon the judgment of the Hon'ble Division Bench of this Court in the case of Rara Brotheres Vs.M.L. Dey reported under [2000 (126) E.L.T. 425 (425)], Angou Golmei Vs Vizovolie Chakha Sang reported under [1996 (81) E.L.t. 440 (Pat.)] and that by the Division Bench of Bombay High Court in the case of M.G. Abrol, Additional Collector of Customs., Bombay Vs. Amichand Vallamji reported under [2002 (149) E.L.T. 32 (Bom.)]. Learned counsel submits that when the respondents are not able to fulfil the legal requirement of valid search and seizure, having resorted to the contention that the sample of seized Areca Nuts were tested and found to be unsafe for food and human consumption and those are not confirming the standards under the Regulation No. 2.12 and 2.3.47 (5) of the Food Safety and Standards (Food Products Standards & Food Additives) Regulations, 2011. 8. Learned counsel relied upon Section 47 of the Foods Safety and Standards Act, 2006 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal conclusion is that the sample of Arecanuts provided by the Assistant Commissioner, Office of the Assistant Commissioner, Customs (Prev.) Division, Goriyare Chowk, Forbesganj, Araria Bihar vide letter C.No. VIII(10) 319/Cus/Seiz/DPU/FBG/18-19/1524 dated 07.02.2019 under its seal has been tested and find that it is difficult to identify the country of origin. 10. That Central Food Laboratory, Kolkata, Extension Centre Raxaul, Bihar in vide their Certificate No. INF/CFL/KOL/RXL/19/FEB-70 provided the test report: "The sample of Betel Nut were tested as per Standard Food Safety norms falling under regulation No. 2.12 & 2.3.47 (5) of Food Safety Standards (Food Products Standards & Food Additives) Regulations, 2011 and found non-conforming to the standards due to presence of Damaged Betel Nuts and presence of Insects. Thus the sample is 'unsafe food' under Section 3(I)(ZZ)(ix) of Food Safety and Standards (Food Products Standards & Food Additives (FSS) Act, 2006.". 11. That to ascertain the country of origin of the seized goods, further investigation viz. verification of buyer/seller and their actual work profile from jurisdictional Commissionerate, verification of documents s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; or (b)taking, in the presence of the Magistrate, photographs of such goods, and certifying such photographs as true; or (c) allowing to draw representative samples of such goods, in the presence of the Magistrate, and certifying the correctness of any list of samples so drawn. (1-C) Where an application is made under sub-section (1- B), the Magistrate shall, as soon as may be, allow the application.] (2) Where any goods are seized under sub-section (1) and no notice in respect thereof is given under clause (a) of section 124 within six months of the seizure of the goods, the goods shall be returned to the person from whose possession they were seized: 1. Inserted by Act 80 of 1985, S. 8 (w.e.f. 27-2-1985) Provided that the aforesaid period of six months may, on sufficient cause being shown, be extended by the 1[Principal Commissioner of Customs or Commissioner of Customs] for a period not exceeding six months. (3) The proper officer may seize any documents or things which, in his opinion, will be useful for, or relevant to, any proceeding under this Act. (4) The person from whose custody any documents are seized under sub-section (3) shall be entitled to make ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad in fact been challenged before the Hon'ble Supreme Court in Special Leave to Appeal (Civil) No. CC7331 of 2014 but the same was dismissed on 08.05.2014 keeping the question of law open. 25. This Court reiterated that in absence of there being any standardized laboratory test for tracing the country of origin, established under some statute and unless such Labs have been accredited by the competent authority and that the Labs could have the scientific method to come to a conclusion that the Betel Nut is of a particular country's origin, it would not be in the interest of justice to direct the petitioner to pay the custom's duty. 26. This Court finds that in the present case the request of the petitioner to release the Betel Nuts have 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 i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h are governed by Prevention of Food Adulteration Act, 1954, shall be subject to all the conditions laid down in the aforesaid Act. Import of all these products will have to comply with the quality and packaging requirements as laid down in the Act. Compliance of these conditions is to be ensured before allowing customs clearance of the consignment. 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 dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... food items for random checking and testing would be done by the Customs taking into consideration factors like the nature of the food products, its source of origin as well as track record 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 (R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y be tested. This should apply regardless of port of import so long as the importer, 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 paragraph 2, 2.1., 2.2, 2.3 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 20 November, 2018 Import of Betel Nut/Areca Nut Standards of areca nuts are prescribed under sub-regulation 2.3.55 of Food Safety and Standards (Food Products Standards and Food Additives) Regulations, 2011 and also in Chapter 2 of Food Safety & Standards (Contaminates, Toxins & Residues) Regulations 2011. Furthe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he 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 communicated to the importer or his authorized representative/ Customs Broker immediately on its receipt. b. In case the importer or his agent intends to request the Additional/ Joint Commissioner of Customs for a re-rest, then the same shall be made in writing to the said officer within a period of ten days from the receipt of the communication of the test results of the first test. Customs officers may take a reasoned view in case the importer or his authorized representative Customs Broker is unable to do so for reasons beyond his control. c. Where the Additional/Joint Commissioner of Customs grants an opportunity for a second test, he must clearly indicate in writing the name and address of the laborat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt 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 India Ministry of Commerce and Industry Department of Promotion of Industry and Internal Trade NPC-QCI Section Udyog Bhawan, New Delhi Dated 4th June, 2019 OFFICE MEMORANDUM Subject: A letter from Chairman, Central Board of Indirect Taxes & Customs regarding matter related to import of Areca Nut / Betel Nut. The undersigned is directed to refer to D.O. letter No. 451/24/2018 Cus.V dated 05.04.2019 [copy enclosed] received from Chairman, Central Board of Indirect Taxes & Customs (CBITC), Department of Revenue, M/o Finance addressed to Secretary, DPIIT regarding matter related to import of Areca nut /Betel nut. 2. In this regard, it is stated that the matter was referred to BABL and NABL vide email dated 16.05.2019 (copy enclosed) has stated that they have contacted ARDF Mangalore and ICARIISR, Calicut labs and discussed regarding NABL accreditation. NABL would follow up with them and ensure their accredi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... est Central Food Laboratory. Further it appears that the guidelines for provisional release of the seized goods as contained in Circular No. 35 of 20017 was not placed before the learned Writ Court. The guidelines specifically provides in paragraph '2' that the request for provisional release of the seized food shall not be allowed in the given cases, one of the cases in which release shall not be allowed is where the goods do not fulfill the statutory compliance requirements /obligations in terms of any Act, Rule, Regulation or any other law for the time being enforced. 34. Further the information furnished by the Director (Imports) in the communication dated 20th November, 2018 with regard to merit of Betel/Areca Nut are also important to appreciate. It clearly provides that Areca Nuts, commonly known as Betel Nuts is capable of the formation of Fungal growth during various stages of its production, storage or transportation, therefore, the consignment of imported Betel /Areca Nut shall not be cleared through risk management system and all the imported consignments shall be subjected to 100% sampling and testing. The FSSAI's authorized officers and custom officers as authoriz ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ith regard to the sustainability of the seizure. This Court had earlier occasion to deal one mater being C.W.J.C. No. 7589 of 2018 (M/s Ayesha Exports vs. The Union of India and Ors.). In the said case the solitary question which was considered by this Court was as to whether the seizure report may be allowed to sustain when it is an admitted position that M/s Areca Nut Research and Development Foundation, Manglore is not accredited laboratory and it's report has been held to be of no legal sanctity by the learned Writ Court in Salsar Transport Company (supra). In the same case the seizure of Betel Nuts was sought to be done on the sole consideration that the report of ADRF, Manglore declared that the Betel Nuts seemed to be of Indonesian Origin. This Court held that because in the case of Salsar Transport Company and Anr. (supra) the report was not having any legal sanctity and there was not material to show that the said laboratory is an accredited laboratory by the competent authority, it's report cannot have a consequence of fastening of any legal liability. In the said case, the information received under the Right to Information Act by the petitioner were placed before this C ..... X X X X Extracts X X X X X X X X Extracts X X X X
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