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Issues Involved:
1. Legality of the extension of time for issuing a show cause notice u/s 124 of the Customs Act. 2. Validity of the seizure and detention of goods u/s 110 of the Customs Act. 3. Authority and procedure for reopening the assessment of goods post-clearance. Summary: 1. Legality of the Extension of Time for Issuing a Show Cause Notice u/s 124: The petitioner challenged the proceedings initiated u/s 110(2) and 124 of the Customs Act and the detention of goods. The extension of three months granted by the Collector of Customs was deemed invalid as it was made ex-parte without giving the petitioner an opportunity to be heard. The court emphasized that the act of extension is a quasi-judicial act requiring a judicial approach, as per the Supreme Court's ruling in *The Assistant Collector of Customs and Superintendent, Preventive Service Customs, Calcutta and others v. Charan Das Malhotra*. The Collector must record reasons for granting an extension and act judicially, which was not done in this case. 2. Validity of the Seizure and Detention of Goods u/s 110: The goods were seized on 27th September 1985, and a notice u/s 110 of the Customs Act was issued. The petitioner argued that the goods were cleared upon payment of customs duty and production of necessary documents. The court found that no valid extension of the period for issuing a show cause notice was made before the expiry of the initial six months. Consequently, the petitioner acquired a vested right to the return of the goods, which could not be taken away by an ex-parte order. The court ordered the release of the goods from seizure and detention. 3. Authority and Procedure for Reopening the Assessment of Goods Post-Clearance: The court noted that the goods had been assessed and released after proper examination. The Deputy Collector's order for assessment and release was not set aside or reviewed according to the provisions of the Act. Therefore, the customs authorities could not reopen the assessment without following the due process. The court held that the goods, once released after proper assessment, could not be seized again for alleged under-invoicing without fresh material evidence. Conclusion: The court concluded that the extension of the period for issuing a show cause notice was invalid, and the goods must be released from seizure. The respondents were permitted to issue a fresh show cause notice under Section 124 of the Customs Act and proceed in accordance with the law, ensuring the petitioner is given a reasonable opportunity to be heard. The petitioner was allowed to deal with or dispose of the goods after retaining one coil for inspection by the customs authorities if required.
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