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2018 (9) TMI 52 - HC - CustomsValidity of Search and seizure proceedings - detention of valuables along with seizure of the key - fraudulent drawback availed - petitioner prays for release of articles - Held that - In the present case, the key was seized and consequently articles were detained on 07.07.2017. Since then, the petitioner has not been afforded access to the jewellery. Though it is not a direct seizure or detention the effect of such action is that the petitioner has been deprived of the use of her property - The period provided under Section 110 i.e. six months elapsed, the Revenue could have, if it chose to extend that period provided the powers were resorted to within the six month period. Even that option was not exercised. The petitioner is, therefore, clearly entitled to release of all the articles in her locker as well as the locker key. Since the customs authorities have inventorized these goods, it is open for them to continue with the adjudication proceedings as and when they issue show cause notice - petition allowed.
Issues:
1. Detention of gold jewellery and valuables in a locker during search and seizure proceedings by the Department of Revenue Intelligence (DRI). 2. Allegations by DRI regarding fraudulent activities and failure to disclose sources of funds. 3. Interpretation of Sections 110, 110A, and 124 of the Customs Act. 4. Effect of non-issuance of show cause notice within the statutory period on the release of seized goods. 5. Petitioner's entitlement to the release of articles and locker key. Analysis: 1. The petitioner's grievance arises from the detention of gold jewellery and valuables found in a Corporation Bank locker during search and seizure by the DRI. The petitioner sought directions for the release of the key and articles, citing Section 110(2) of the Customs Act. The DRI alleged fraudulent activities and failure to disclose the source of funds for the jewellery, leading to the detention. The petitioner relied on precedents to support her claim for release. 2. The judgment analyzed the provisions of Section 110, 110A, and 124 of the Customs Act in light of previous court decisions. The Court emphasized the mandatory nature of Section 110(2) and the consequences of not issuing a show cause notice within the specified time. It discussed the effect of provisional release under Section 110A and clarified that it does not override the operation of Section 110(2) regarding the release of seized goods. 3. The Court highlighted the importance of statutory timelines and consequences for non-compliance, citing relevant legal precedents. It emphasized that the expiration of the one-year period without a show cause notice results in the unconditional release of seized goods. The judgment clarified that the existence of Section 110-A does not diminish the mandatory nature of Section 110(2) in terms of releasing seized goods. 4. In the specific case, the Court found that the petitioner was entitled to the release of the articles and locker key since the statutory timelines had lapsed without a show cause notice being issued. The judgment directed the respondents to return the locker key and allow the petitioner to utilize the jewellery found during the search. The Court upheld the petitioner's right to access her property and ordered the release of the seized items within two weeks. 5. Overall, the judgment focused on the legal interpretation of relevant sections of the Customs Act, the mandatory nature of statutory provisions, and the petitioner's entitlement to the release of seized goods based on non-compliance with the show cause notice requirement. The Court's decision favored the petitioner's claim for the release of the detained articles and the locker key.
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