Case Law Details
Chokshi Arvind Jewellers Vs Union of India & Ors. (Bombay High Court)
Bombay High Court directed Senior Intelligence Officer and Additional Directorate of DRI to file their reply in a custom seizure matter
The case of Chokshi Arvind Jewellers vs. Union of India & Ors. before the Bombay High Court revolves around the seizure of valuable gold, including gold bars and coins, with a substantial market value. The petitioner asserts that they have complied with all necessary documentation and have proven that the seized gold is part of their stock in trade. However, despite their efforts and requests, the gold remains in custody.
The petition raises concerns regarding the legality and transparency of the seizure of gold by the Directorate of Revenue Intelligence. The petitioner claims that no show cause notice was issued, and their repeated appeals to release the seized gold were left unanswered.
The key points in the analysis include:
Documentation Submitted: The petitioner submitted all documents related to the purchase of the gold from the seller, Munira Zaheer Mamnoon, along with statements. They also provided evidence of the gold’s market value and its status as part of their stock in trade.
Lack of Show Cause Notice: The petitioner emphasizes the absence of a show cause notice, which is typically required under the provisions of the Customs Act, 1962.
Correspondence: The petitioner’s letters dated June 5, 2023, July 25, 2023, and August 31, 2023, highlight their efforts to communicate with the authorities and their concerns about the seized gold.
Response from Authorities: The response from the authorities, particularly Mr. Manish Kumar, Senior Intelligence Officer, is crucial. The letter dated August 11, 2023, indicates that a show cause notice should be issued, and the matter should be adjudicated based on the owner’s submissions. This letter is cited as a key reference.
Conclusion: The Bombay High Court has taken cognizance of the urgency of the situation, as there were fears that the seized gold might be disposed of without giving the petitioner an opportunity to present their case. The court has ordered the respondents, including Mr. Manish Kumar and the Additional Directorate (General), to submit a reply affidavit.
The case raises significant legal questions, including the legality of selling seized goods, especially when they are not perishable, without proper proceedings. The court will determine whether the actions of the authorities were legal and valid and decide on the appropriate course of action, including compensation for any losses incurred by the petitioner.
The case is scheduled for further hearing on October 4, 2023, when both parties will have the opportunity to present their arguments, and the court will make further orders based on the affidavits and arguments presented. This case underscores the importance of due process and transparency in matters involving customs seizures and the rights of affected parties.
FULL TEXT OF THE JUDGMENT/ORDER OF BOMBAY HIGH COURT
1. This petition under Article 226 of the Constitution, concerns the gold namely gold bars of net weight 741.40 grams of 24kt and gold coins of net weight 864.41 grams 22kt, having foreign markings and of the market value of Rs.96,91,965/-. Such gold was subject matter of seizure memo which was issued by Mr. Manish Kumar SIO / D-Cell dated 12 May 2023 (Exhibit-C).
2. According to the petitioner all documents in regard to the purchase of such gold by the petitioner from one Munira Zaheer Mamnoon, as also the statement of Mr. Munira was submitted to the said authority/respondent on 2 May 2023 and 12 May 2023. The petitioner had also furnished all necessary documents in regard to the value of the said goods that the said gold was stock in trade of the petitioner. The case of the petitioner is that no show cause notice was issued to the petitioner, as also the repeated requests made by the petitioner to release the seized gold were not responded. In this context, our attention is drawn to the petitioners letter dated 5 June 2023 and 25 July 2023 (Exhibit-D) as also to the subsequent letter dated 31 August 2023.
3. Learned counsel for the petitioner has drawn our attention to the letter dated 11 August 2023 (Exhibit-R) addressed to the petitioner in response to the petitioners letter dated 6 June 2023 and 25 July 2023, stating that in relation to the said seizure, a show cause notice has to be issued within the time specified under the provisions of Customs Act 1962. It was also recorded that after issuance of the show cause notice, the competent adjudication authority would decide the matter based on the submissions made by the owner of the seized goods. It was recorded that the said letter was issued with the approval of the competent authority. The signatory of the said letter is again Mr. Manish Kumar, Senior Intelligence Officer (SIO/D-Cell). For convenience, we extract the contents of the letter which reads thus:-
“Date 11 August 2023
To,
1) Shri Kapil Kumar Parekh
51/7, Shobhna building,
Sion Main Road, Sion West,
Mumbai-22.
2) M/s Choksi Arvind Jewellers
105-107, Zaveri Bazr,
Shaikh Memon Street, Mumbai
400002.
Subject: Gold consisting of 24 KT Gold Bars of net weight 741.140 grams and 22 KT Gold Coins of net weight 864.410 gramsreg.
Ref: Your letter dated 05.06.2023 and reminder letter dated 25.07.2023.
With reference to your above-mentioned letters, it is informed that the show cause notice has to be issued within the time specified
under provisions of the Customs Act, 1962. Further, after the issuance of show cause notice, the competent adjudication authority decides the matter based on the submissions made by the owner of the seized goods.
2. This issues with the approval of competent authority.
Yours Sincerely
(Manish Kumar)
Senior Intelligence Officer”
(emphasis supplied)
4. With an apprehension that the respondents are likely to sell the goods, this petition was filed on 11 September 2023 and urgently moved before us, praying that the seizure memo dated 12 May 2023 issued by respondent No.4 be held illegal and be quashed and set aside, and for unconditional release of the said gold as seized by the respondent.
5. Learned counsel for the petitioner has contended that this is a case of blatant, arbitrary and illegal action on the part of the respondent Nos. 2 to 4 of having exercising the power of search and seizure merely onsuspicion and by which the stock in trade / gold from the petitioner’s shop has been seized and was not being released despite repeated letters of the petitioner’s.
6. On 11 September 2023 a praecipe came to be moved in the present proceedings seeking urgent orders on the ground that the petitioner has serious apprehension that the seized gold would be disposed of by the respondent without giving an opportunity of hearing to the petitioner.
7. Accordingly, we had granted circulation of the matter. The proceedings were served on the respondents on 12 September 2023.
8. Today, learned counsel for the respondents, on instructions, submits that the seized gold has already been disposed of by the respondents on 1 September 2023 i.e. prior to the filing of this petition which came to be filed on 11 September 2023 and before the petitioner could seek circulation of the present proceedings.
9. In the aforesaid circumstances, as urged on behalf of the petitioner, the following issues arise for our consideration :-
(i) whether the action of the respondents to sell the gold as seized by the petitioner, is legal and valid and more particularly taking into consideration the letter dated 11 August 2023 addressed by Mr.Manish Kumar, Senior Intelligence Officer of the Directorate of Revenue Intelligence to the petitioner which refers to issuance of a show cause notice in dealing with the seized goods;
(ii) under what provisions of law and / or any notification goods which are not perishable, an action for sale can be justified;
(iii) if such an action of sale is held to be illegal, what should be the course of action, the law would mandate to be taken against the concerned officers so as to compensate the petitioner for the loss.
10. We accordingly direct the respondents and more particularly, the officers who were dealing with the matter i.e. respondent No.4 – Manish Kumar as also respondent No.2 – Additional Directorate (General) to place on record a reply affidavit.
11. Let both the affidavits be placed on record on or before the adjourned date of hearing so that the parties can be heard and further appropriate orders can be passed.
12. Stand over to 4 October 2023 (HOB).
