Mundhra Exim Pvt Ltd Vs Union of India And Others (Madhya Pradesh High Court)
Madhya Pradesh High Court held that customs authority doesn’t have authority to pass an order of provisional attachment under section 110(5) of the Customs Act, 1962 during pendency of investigation. Accordingly, freezing of bank account not justified.
Facts- Petitioners are importers of Sri Lankan-origin edible goods, specifically Areca Nuts, which had sought exemption benefits under the Indo-Sri Lanka Free Trade Agreement (ISLFTA). During an investigation, Respondents scrutinized the past imports done by Petitioners in November, 2022 and it was noticed that petitioners had imported 4 consignments of Areca-Nuts in the past, declaring them as Srilankan origin, and availed the duty exemption under ISFTA.
With regard to consignment imported in November, 2022, process of verifying the Certificates of Origin (‘COO’) in respect of the aforesaid 4 consignments was started. CBIC reported that one of the COO in respect of Bill of entry No. 3540232 dated 30.11.2022 filed by M/s Mundhra Exim Pvt. Ltd/Petitioner No.1. was found to be fake. Pertinently, in relation to aforesaid file number, two intimation notices dated 07.12.2023 had been issued u/s. 110(5) of Customs Act, 1962 thereby provisionally freezing the bank account of the petitioners for 6 months and thereafter again two intimations dated 03.06.2024 were issued thereby extending the period of freezing of bank accounts of petitioner for another 6 months which was to expire on 03.12.2024. Additional Director General, DRI, Indore Zonal Unit issued impugned intimation dated 03.12.2024 was issued freezing the bank accounts of the petitioners for a period of 6 month.
