2018 (6) TMI 1446 - HC - Customs

Release of detained goods - time limitation for issuance of notice for seizure of goods - date of commencement period of six months under Section 110(2) - Held that - Section 110(2) of the Customs Act, 1962 contemplates a situation where any goods are seized under sub-Section (1) and no notice in respect thereof is given under clause (a) of section 124 within six months of the seizure of the goods, the goods shall be returned to the person from whose possession they were seized. In the present case, the parties are at variance on the date of commencement. The respondents have a particular view on the subject. They should, therefore, be afforded one opportunity to file affidavits to substantiate their point of view on the issue concerned. It would not be proper to grant an interim order directing the release of the goods - interim order refused.

Issues:
1. Unauthorized detention of goods by Customs authorities.
2. Interpretation of Section 110(2) of the Customs Act, 1962 for the release of goods.
3. Dispute regarding the date of seizure of goods.
4. Consideration of the definition of importer under Section 2(26) of the Customs Act, 1962.
5. Compliance with Section 49 of the Customs Act, 1962 for warehousing of goods.

Analysis:
1. The petitioner alleges unauthorized detention of goods by Customs authorities, claiming entitlement to release under Section 110(2) of the Customs Act, 1962. The petitioner asserts that the authorities exercised control over the goods on October 13, 2017, triggering the six-month period for release. However, the DRI and Customs argue that the seizure occurred on January 6, 2018, disputing the commencement date of the prescribed period. The Court deems this factual dispute necessitating further consideration and directs the respondents to file affidavits to substantiate their stance.

2. Referring to precedents like ESI Limited and M/s. A.S. Enterprises, the Court deliberates on when goods are deemed seized under the Customs Act, 1962. The petitioner relies on these cases to support their claim of dominion by authorities on October 13, 2017. However, the DRI contests the characterization of the October directive as a seizure, emphasizing the need for possession and compliance with prescribed procedures. The Court refrains from granting an interim release order, pending clarification on the commencement date of the six-month period.

3. The petitioner's advocate highlights the definition of importer under Section 2(26) of the Customs Act, 1962, arguing that even if the petitioner is not the actual owner, the authorities can issue a show cause notice and proceed legally. The Court acknowledges the petitioner's stance and cites a Kerala High Court judgment on the importation by a "name lender." However, concerns are raised regarding the petitioner's conduct, alleging mis-description and revenue fraud, supported by documentary evidence.

4. In relation to compliance with Section 49 of the Customs Act, 1962 for warehousing goods, the Customs advocate asserts that the petitioner failed to adhere to conditions, including the presence of claimed "Directors" during the procedure. The petitioner's response suggests apprehension about the authorities taking the individuals into custody if they appear, leading to their non-compliance.

5. The Court directs the filing of affidavits by the respondents within specified timelines and schedules the petition for a hearing. Additionally, the Court recognizes the necessity of adding the DRI as a party respondent, granting leave for amending the cause title accordingly. The DRI's representation is acknowledged, and service requirements are outlined for the amended cause title.

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