2010 (8) TMI 301 - HC - Customs

Seizure of goods documents and things - Court would not speculate that in the facts and circumstances of the case what is the penalty and how much penalty should be imposed - Sri J.N. Mathur further submitted that though there is no limitation prescribed for issuing show cause notice under Section 124 (a) and in the instant case ten months have already passed from the date of seizure but no notice has yet been issued; Submission is that non-issuance of notice and consequently not proceeding with the case is adversely affecting the business interest of the petitioners and therefore a direction be issued for early disposal of the matter by the custom authorities - The petition is dismissed

Summary

Issues: Alleged inaction by custom authorities, extension of adjudicating process, issuance of notice under Section 124, penalty imposition, reduction of Bank Guarantees, delay in adjudication proceedings

Alleged Inaction by Custom Authorities:
The petitioners challenged the inaction of custom authorities, arguing that the adjudicating process was prolonged beyond the statutory six-month period under Section 110(2) of the Customs Act, 1962. They contended that no notice under Section 124 had been issued, and the respondents sought an extension of the Bank Guarantees period instead. However, the respondents justified their actions by stating that the seized goods were returned within six months upon furnishing the Bank Guarantee, thus not necessitating an extension. The court noted that the provisions of Section 110(2) mandate the return of goods if no notice is issued within six months, which was not violated in this case.

Penalty Imposition and Bank Guarantees:
The respondents argued that the penalty could be up to five times the value of the goods under Section 117-AA due to false declaration by the petitioner. They emphasized that the imposition of penalty falls within the discretion of custom authorities. The court declined to interfere with the amount of Bank Guarantees, stating that the penalty imposition is at the authorities' discretion, and the court cannot speculate on the penalty amount in this case.

Delay in Adjudication Proceedings:
The petitioners raised concerns over the delay in issuing a show cause notice under Section 124(a), affecting their business interests. The respondents assured that adjudication proceedings were ongoing, requiring time for evidence collection from various sources. They committed to issuing the notice within a month. The court observed that while no undue delay was anticipated, it directed the authorities to issue the notice promptly within a month and conclude the proceedings expeditiously.

Conclusion:
The court dismissed the petition, noting that there was no illegality in the actions of the custom authorities. It emphasized the need for cooperation between the parties to expedite the proceedings. The judgment highlighted the statutory provisions governing the return of goods and the discretionary power of authorities in penalty imposition, ultimately upholding the actions of the custom authorities while ensuring timely progress in the adjudication process.