Sukhdeo Singh Vs Marudhar Assam Road Lines Pvt. Ltd. (Patna High Court)
Panchnama could not be considered as Seizure Memo and seizing officer must record minimal reasons in seizure memo
Conclusion: Panchnama could not be considered as seizure memo and the customs officers acting on secret information must record at least the minimal reasons in the seizure memo as seizing officer could not keep reasons in his mind and he had to disclose minimal reasons in the seizure memo.
Held: Assessee’s were engaged in the business of Areca Nuts. The first petitioner operated under M/s Krishna Kali Traders, West Bengal, and the second petitioner under M/s Nirmal Kumar Mahavir Kumar, New Delhi. The second petitioner purchased 21,700 kg of Areca Nuts worth ₹39,43,275 from the first petitioner, supported by a Tax Invoice. Transportation of the goods was arranged through Marudhar Assam Road Lines Private Limited, with an e-way bill generated the same day. The Customs officials intercepted and seized the truck in Muzaffarpur, State of Bihar. The vehicle was taken to the Customs office and the vehicle and Areca Nut goods were seized in the Customs office. For seizure of the truck and Areca Nut goods on 14.08.2020, seizure memo was drawn by the Seizing Officer, Customs (P) Division, Muzaffarpur. The core issue was whether the seizure memo under Section 110 of the Customs Act, 1962, complied with legal requirements, including provisions under Sections 110(1A), (1B), and (1C), concerning inventory, conveyance, and certification by a Magistrate. Assessee argued that seizure memo was legally invalid due to non-compliance with Sections 110(1A), (1B), and (1C) of the Customs Act. They contended that Panchnama, prepared subsequent to the seizure memo, violated established procedures. To support their claims, assessee relied on a notification dated February 5, 1986, and a Circular dated February 8, 2017, both of which mandate adherence to statutory provisions. Furthermore, they reference judicial precedents, including Assam Supari Traders v. Union of India and Worldline Tradex P. Ltd. v. Commissioner of Customs, which asserts that a Panchnama cannot replace a seizure memo. It was held that Panchnama could not be read into seizure memo. That apart reading of both the seizure memo and Panchnama, one can draw inference that firstly seizure memo had been prepared and secondly Panchnama had been drawn, therefore, at the time of writing seizure memo, Panchnama was not written or existed. This was evident from reading of Panchnama. It was also submitted, on behalf of the respondents, that they had a secret information and on the basis of such secret information the Seizing Officer had proceeded to seize the subject matter of vehicle that suffice the reason. Secret information was only tentative when Section 110 of the Act, 1962 stipulated that reason to believe. In this backdrop, Seizing Officer could not keep reasons in his mind and he had to disclose minimal reasons in the seizure memo. Therefore, the contention of the respondents that seizure memo was to be read with Panchnama was wholly incorrect and contrary to Customs Department Notification dated 08.12.2017.
