Case Law Details
Priyanka Maurya Vs Union of India And Ors. (Calcutta High Court)
Seized Areca Nuts Provisionally Released Subject to Safeguards; Customs Adjudication Time Fixed: Calcutta HC
The Calcutta High Court considered whether the petitioner was entitled to provisional release of 24,500 kgs of Assam dried areca nuts seized on 24.11.2023 and declared by the Food Safety and Standards Authority of India (FSSAI) to be substandard and unsafe for human consumption, pending adjudication proceedings initiated on 15.05.2024.
The petitioner submitted that the application dated 18.07.2024 for provisional release was rejected on 09.10.2024 based on the FSSAI test report. It was contended that the goods were perishable and had remained under seizure since 24.11.2023, causing prejudice. The petitioner offered an undertaking that the goods would be used exclusively for industrial purposes and not diverted for human consumption. Reliance was placed on the CBIC Circular dated 16.08.2017 providing for provisional release of seized imported goods on execution of a bond and furnishing of a bank guarantee or security deposit.
The respondents opposed provisional release, contending that adjudication proceedings were pending and release would prejudice the interests of the revenue. They submitted that, if released, the conditions prescribed in the CBIC Circular should apply and the goods should be sold in the presence of the concerned authorities.
The High Court held that the petitioner had made out a prima facie case, noting the perishable nature of the goods and the delay in adjudication. It directed provisional release subject to execution of a bond, furnishing of a bank guarantee in terms of the CBIC Circular dated 16.08.2017, an undertaking restricting the goods to industrial use, and disclosure of the purchaser’s details along with the time and venue of sale. The Court also directed the adjudicating authority to complete the adjudication within eight weeks, preferably on or before 30th September, while requiring the petitioner to cooperate and not seek adjournments. The application and the writ petition were disposed of accordingly.
FULL TEXT OF THE JUDGMENT/ORDER OF CALCUTTA HIGH COURT
The core issues involved herein is as to whether the petitioner is entitled to provisional release of 24,500 kgs of Assam Dried Areca Nuts, which were seized on 24.11.23 and declared by FSSAI to be substandard and unsafe for human consumption, pending adjudication proceedings initiated on 15.5.24 and if so, on what terms.
It is submitted on behalf of the petitioner that an application dated 18.7.24 seeking provisional release of the said goods was rejected by the concerned authority on 9.10.24 based on a sample test report from the Food Safety and Standards Authority of India (FSSAI).
The goods are perishable in nature and have been under seizure since 24.11.23, causing grave prejudice to the petitioner.
The petitioner seeks provisional release upon furnishing an undertaking that the goods shall be used exclusively for industrial purposes and shall not be diverted for human consumption.
Reliance is placed on CBIC Circular dated 16th August, 2017 (AnnexureR-4) particularly para 2.1 and 2.2 which provides for provisional release of seized imported goods upon execution of a bond and furnishing of a bank guarantee/security deposit to cover differential duty, fine in lieu of confiscation under Section 125 of the Customs Act, 1962 and applicable penalties.
The learned senior counsel appearing for the respondent authorities vehemently opposes the prayer for provisional release and contends that:
i. Adjudication proceedings in respect of the seized goods are pending.
ii. Provisional release at this stage would prejudice the interest of the revenue.
iii. The goods shall be provisionally released in terms of the conditions laid down in the circular dated 16th August, 2017 particularly as per para 2.1 and 2.2.
iv. If the goods are provisionally released in that event the same shall be sold in the presence of the concerned authorities.
Having heard the learned counsel for the parties and upon perusal of the records, this Court finds that the petitioner has been able to make out a prima facie case for interference at this stage. The perishable nature of the goods and the delay in adjudication since 15.5.24 are material consideration.
The circular dated 16.8.17 issued by the CBIC provides a settled mechanism for provisional release of seized goods subject to adequate safeguards which is extracted below:
“2.1. Seized imported goods shall be released provisionally by the competent authority upon request of the owner of the seized goods, subject to executing a Bond for the full value/estimated value of the seized goods.
2.2. Further, in addition to the Bond mentioned at Para 2.1. above, the competent authority shall take a Bank Guarantee or Security Deposit to cover the following:
i. the entire amount of duty/differential duty leviable on the seized goods being provisionally released;
ii. amount of fine that may be levied in lieu of confiscation under Section 125 of the Customs Act, 1962 at the time of adjudication of the case. While securing the same, the competent authority shall take into account the nature of the seized goods, the duty and charges payable on the said goods, their market price and the estimated margin of profit;
iii. amount of penalties that may be levied under the Customs Act, 1962, as applicable, at the time of adjudication of the case.”
Accordingly the concerned authority is directed to provisionally release the seized goods as per the following directions:
i. The petitioner shall execute a Bond in terms of 2.1 of the Circular dated 16th August, 2017 and
ii. The petitioner shall furnish a bank guarantee, to the satisfaction of the competent authority, in terms of para 2.2 of the said circular.
iii. The petitioner shall furnish and undertaking that the seized goods shall be used exclusively for industrial purposes and not for human consumption.
iv. The petitioner shall provides the details of the purchaser including identity proof as well as the time and venue where the seized goods are to be sold.
v. Since adjudication proceedings have been pending since 15th May, 2024 the adjudicating authority is peremptorily to complete the entire process of adjudication within a period of 8 weeks from date preferably on or before 30th September. The petitioner shall cooperate with authority and shall not seek any adjournment.
With the above observations and directions the GA no.1 of 2026 is allowed and disposed of. Accordingly, the writ petition is also stands disposed of.
Since no affidavit has been called for, the allegations made in the petition are denied and deemed not to have been admitted.
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