TMI Blog2020 (12) TMI 329X X X X Extracts X X X X X X X X Extracts X X X X ..... customs department is accepted, then also detention would be at a stage after seizure. Detention and seizure therefore cannot be used interchangeably meaning one and the same thing. Detention cannot be taken resort to or the customs authorities cannot take the plea of detention to avoid consequences of seizure under sub section (2) of section 110 of the Customs Act. If no show-cause notice under section 124(a) is issued, customs authorities cannot retain the seized goods for more than six months though the aforesaid period of six months can at best be extended for a further period not exceeding six months. Therefore beyond the period of one year at the maximum, there cannot be any detention of goods even in the case of seizure without issuing show-cause notice under section 124(a) of the Customs Act. It is glaring to the naked eye that the respondents have committed two illegalities. First illegality is they have detained the goods without affecting seizure. Secondly, they have exceeded the time limit for detention of the goods even if it is construed to be a case of seizure. In such circumstances, the impugned action cannot at all be justified and is liable to be appropriately ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... customs authorities decided that the goods imported by the two bills of entry dated 17.05.2019 and 24.05.2019 were required to be examined 100%. However, acting on instructions of the Directorate of Revenue Intelligence (DRI), Zonal Unit, Kolkata, petitioner was informed that such examination would be carried out only in the presence of proprietor of the petitioner. In this backdrop, when the legal representative of the petitioner had appeared before the customs authorities on 11.06.2019 for examination of the consignments, the Joint Commissioner did not allow him to participate in the examination proceedings. Request of the petitioner for warehousing of the goods under section 49 of the Customs Act, 1962 (briefly the Customs Act ) was also not responded to. 7. In such circumstances, petitioner had filed a writ petition before this Hon ble Court which was registered as Writ Petition No.7687 of 2019. During the proceedings of the said writ petition, respondents had contended that several summons were issued to the petitioner by DRI, Zonal Unit, Kolkata under section 108 of the Customs Act, but petitioner failed to comply with the summons and did not respond. It was stated that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... liable to be appropriately interfered with. 14. When the writ petition was moved on 13.03.2020, learned counsel for the respondents sought for time to obtain instructions. On his request, case was deferred to 24.03.2020. Thereafter due to the outbreak of Covid-19 pandemic and the resultant lock-down, the case could not be taken up for consideration. Finally, when the case was taken up on 22.10.2020, Mr. Pradeep Jetly, learned senior counsel along with Mr. J. B. Mishra, learned counsel submitted that they had received instructions to appear on behalf of the respondents. On the next date of hearing i.e. on 29.10.2020 contention was advanced by learned counsel for the petitioner that the period of detention of the imported goods had exceeded one year which is the outer time limit in the event of seizure where show-cause notice under section 124 has not been issued; in the present case there is no seizure and the goods have been simply held up. Therefore petitioner is entitled to release of the detained goods forthwith. Mr. Pradeep Jetly was granted time to obtain instructions on this contention. Subsequently, an affidavit was filed on behalf of respondent No.3. 15. In the said a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nferior quality stones, the present consignments of the petitioner is under scanner and as such the same is required to be examined 100%. Accordingly, letter was written by the authorities of DRI, Kolkata Zonal Unit on 30.05.2019 to the Commissioner of Customs (Import), Nhava Sheva-I to get the consignments examined 100% in the presence of the proprietor. The need for presence of the proprietor is warranted as he has been defying summons issued under section 108 of the Customs Act. 15.5. It is also stated that permission for warehousing of the goods has been granted subject to the condition that the same shall be executed in the personal presence of the proprietor of the petitioner. 15.6. Seeking dismissal of the writ petition, a submission is made that direction may be issued to the proprietor of the petitioner to cooperate with DRI, Kolkata Zonal Unit in the investigation. 16. In its rejoinder affidavit petitioner has contended that respondent No.3 has failed to respond to the core issue raised by the petitioner i.e. as to whether the Customs Commissionerate at Nhava Sheva can retain/detain the goods beyond the statutory period provided under section 110(2) of the Custom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ms Act has been issued till date and not only the initial period of six months but even the extended period of further six months has expired, there is no way that the respondents can withhold release of the two consignments of the petitioner. There is no provision for detention of goods in the Customs Act and such detention for more than a year now is therefore without any authority of law and is liable to be appropriately interfered with. She submits that for investigation in respect of other consignments, the consignments in question cannot be withheld. According to her, even after release of the withheld consignments, respondents can continue with the investigation. Assailing the action of the respondents, she submits that it is extremely high handed and is nothing but trying to arm-twist the petitioner. In support of her submissions, she has placed reliance on a number of decisions. 18. Per contra, Mr. Pradeep Jetly, learned senior counsel has referred to the averments made in the affidavit of respondent No.3. He submits that it quite evident that conduct of the proprietor of the petitioner is highly questionable and therefore the Writ Court in exercise of its discretionary ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... person from whom such goods were seized before expiry of the period so specified. Second proviso says that the specified period of six months shall not apply in a case where order for provisional release of the seized goods has been passed under section 110A. 23. Section 124 provides for issue of show-cause notice before confiscation of goods etc. It says that no order confiscating any goods or imposing any penalty on a person shall be made under the Customs Act unless the owner of the goods or such person is given a notice in writing informing him of the grounds on which confiscation is proposed or penalty is sought to be imposed (clause a); providing an opportunity to make a representation responding to the grounds of confiscation or imposition of penalty (clause b); and providing a reasonable opportunity of being heard (clause c). The first proviso says that at the request of the person concerned the provision for notice and representation under clauses (a) and (b) may be oral. Second proviso mentions that the proper officer may issue a supplementary notice after the show-cause notice. 24. A conjoint reading of sections 110(2) and 124 of the Customs Act would make it clear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uthorities distinguishes between detention and seizure made under the Customs Act. 26.1. If this view is accepted, then detention would be at a stage post seizure. First there has to be seizure of the goods only whereafter the goods can be detained. In the instant case, admittedly there is no seizure. Therefore, there can be no detention. 27. In Om Udyog Vs. Union of India reported in 2010(254) ELT 547 , a division bench of the Punjab and Haryana High Court considered the question as to whether detention of goods for a period of more than two months could be held to be justified. In the facts and circumstances of the case, it was held that non-clearance of goods may be justified for a minimum period required for assessment. In no case, non-clearance of goods for months can be justified. It was held in no uncertain terms that non-clearance seriously affects rights of a 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. Sounding a note of caution, division bench of the Punjab and Haryana High Court took the view that while customs of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 578 held that failure of the customs authorities to release the goods notwithstanding expiry of the time limit under section 110(2) of the Customs Act is unlawful. Accordingly, direction was issued for immediate release of the seized goods unconditionally without precluding the customs department from proceeding to take any further action as permissible in law including proceeding under section 124 of the Customs Act. 31. Upshot of the above discussion is that firstly, there is no provision in the Customs Act authorizing detention of goods. Secondly, even if the understanding of the customs department as discussed in Ramnarain Bishwanath (supra) is accepted, then also detention would be at a stage after seizure. Detention and seizure therefore cannot be used interchangeably meaning one and the same thing. Detention cannot be taken resort to or the customs authorities cannot take the plea of detention to avoid consequences of seizure under sub section (2) of section 110 of the Customs Act. If no show-cause notice under section 124(a) is issued, customs authorities cannot retain the seized goods for more than six months though the aforesaid period of six months can at best b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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