2011 (2) TMI 217 - HC - Customs

Misdeclaration of goods - Seizure of goods and dollars - Coercive statements - Notification No. 31/2003-Customs, dated 1-3-2003 - it is not in dispute that the petitioner is entitled to import upto 10 Kilograms of gold, as it is an admitted fact that he had been living abroad for more than six months - there is nothing shown on behalf of the respondents that the petitioner is not entitled to get the goods released, on his payment of the customs duty and the penalty liable to be paid by him, as per the Notification No. 31/2003-Customs, dated 1-3-2003, issued under Chapter 71 of the First Schedule to the Customs Tariff Act, 1975 - Decided in the favour of assessee

Summary

Issues:
1. Confiscation of gold jewelry by customs authorities upon arrival at Chennai airport.
2. Allegations of non-declaration of gold jewelry and evasion of customs duty.
3. Legal provisions under the Customs Act, 1962 regarding confiscation, penalty, and release of seized goods.
4. Petitioner's entitlement to pay customs duty and penalty for the release of the gold jewelry.

Confiscation of Gold Jewelry:
The petitioner had purchased 7 gold chains from Singapore and declared them upon arrival at Chennai airport. However, despite the declaration, customs officers seized the gold chains and the petitioner's passport, alleging mis-declaration and threatened arrest. The petitioner sought the release of the jewelry, but authorities refused, leading to the writ petition under Article 226 of the Constitution of India.

Allegations of Non-Declaration and Evasion:
Customs authorities alleged that the petitioner did not declare the gold jewelry and attempted to evade customs duty. A show cause notice was issued, citing contravention of Section 77 of the Customs Act, 1962, leading to the confiscation of the jewelry under Section 111 and possible penal action under Section 112. The petitioner's request for release was denied based on these allegations.

Legal Provisions and Petitioner's Entitlement:
The petitioner argued for release by paying customs duty and penalty under Section 125 of the Customs Act, 1962, citing Notification No. 31/2003-Customs. The petitioner, having resided abroad for over six months, was entitled to import gold, a non-restricted item, up to 10 kilograms. The petitioner's counsel highlighted provisions for provisional release under Section 110, confiscation under Section 111, and penalty under Section 112 for improper importation.

Judicial Precedents and Decision:
The petitioner's counsel referenced legal precedents from Andhra Pradesh, Calcutta, and Bombay, emphasizing the option to pay fines in lieu of confiscation for non-prohibited goods. The High Court directed the authorities to provisionally release the gold jewelry to the petitioner upon payment of customs duty and redemption fine as per legal provisions and the Notification No. 31/2003-Customs. The release was subject to adjudication proceedings, with the petitioner's cooperation required. The writ petition was allowed with no costs, and the connected miscellaneous petition was closed.