2012 (5) TMI 17 - HC - Customs

Writ Petition Goods imported were seized as the packings did not have the name and address of the manufacturer and Importer - Held that - Such seizure is clearly without authority of law, no reasonable belief has been entertained or made out on the face of records to show that the imported goods are indeed liable for confiscation under the Customs Act - Revenue is directed to release the subjected to necessary tests by the Port Health Authorities before the customs clearance is sought for by the assessee, the respondent shall allow the petitioner to re-pack and re-label the goods in a customs bonded area - the respondent shall not release the goods unless they are found to be fit for human consumption

Summary

Issues Involved:
1. Assessment and release of Monosodium Glutamate (MSG) imported by the petitioner.
2. Waiver of detention and demurrage charges.
3. Compliance with labeling requirements under Prevention of Food Adulteration Rules, 1955.
4. Legality of the seizure of goods by the Directorate of Revenue Intelligence (DRI).
5. Adherence to the Customs Act, 1962, and Food Safety and Standards Act, 2006.

Issue-wise Detailed Analysis:

1. Assessment and Release of MSG Imported by the Petitioner:
The petitioner, engaged in the import and local sales of food items, imported 506 MTS of MSG from China, covered under three Bills of Entry. The petitioner sought the release of these goods, which were detained by the customs authorities. The customs authorities delayed the assessment and clearance due to an ongoing investigation by the Directorate of Revenue Intelligence (DRI). The petitioner argued that the goods were confirmed to be MSG, a food additive, by various testing agencies and thus should be released.

2. Waiver of Detention and Demurrage Charges:
The petitioner requested the waiver of detention and demurrage charges by issuing a Detention Certificate as per the Customs (Handling of Cargo in Customs Areas) Regulations, 2009. The petitioner argued that the delay in the release of goods was due to the prolonged investigation and not due to any fault on their part.

3. Compliance with Labeling Requirements:
The DRI found that the imported MSG did not comply with Rule 32(c) of the Prevention of Food Adulteration Rules, 1955, as the packaging did not have the name and address of the manufacturer and importer. The respondent argued that this non-compliance made the goods prohibited for import under Section 5 of the Prevention of Food Adulteration Act, 1954. The petitioner contended that the labeling requirements would be met during repacking into smaller retail packs before local sale.

4. Legality of the Seizure by DRI:
The DRI seized the goods under Section 110(a) of the Customs Act, 1962, for violating the Prevention of Food Adulteration Act and Rules. The petitioner argued that the seizure was without authority of law and that no reasonable belief was made out to show that the goods were liable for confiscation. The respondent maintained that the seizure was lawful as the goods violated the labeling requirements.

5. Adherence to Customs Act and Food Safety Standards:
The respondent argued that the imported goods must comply with the Food Safety and Standards Act, 2006, and Rules, 2011, before clearance. The CFTRI, Mysore, confirmed that the samples were MSG, but the labeling details provided by the importer were not found on the actual consignment. The respondent issued a show cause notice under Section 124 of the Customs Act, 1962, and argued that the customs authorities were enforcing compliance with allied Acts and Rules.

Judgment:
The court directed the respondent to release the goods on the condition that the petitioner provides all necessary details to comply with local laws during repacking and relabeling in the customs bonded area. The goods would be subjected to necessary tests by the Port Health Authorities before clearance. The respondent was instructed to allow the petitioner to repack and relabel the goods in a customs bonded area, subject to mutual convenience. The Port Health Authorities were to test and certify the goods, and a fresh order would be passed by the original authority after certification. The court emphasized that the goods should be released only if found fit for human consumption and imposed additional conditions for the release. The entire process was to be completed within four weeks. The petition was disposed of with no costs, and the connected miscellaneous petition was closed.