2023 (2) TMI 332 - HC - Customs

Rejection of petitioner s application filed under Section 125 of the Customs Act 1962 seeking for redemption of Indian and Foreign currencies confiscated from the petitioner by paying fine - Original Authority exercised correct discretion in such rejection or not - HELD THAT - It is not in dispute that under Section 125 of the Customs Act 1962 an option to pay a fine in lieu of confiscation can be sought even for prohibited goods. The judgment relied upon by the learned counsel for the petitioner in UNION OF INDIA VERSUS ROSTAM PARVARESH 2011 (10) TMI 446 - BOMBAY HIGH COURT and RAJU SHARMA AND ANR. VERSUS UNION OF INDIA AND ORS. 2020 (1) TMI 62 - DELHI HIGH COURT dealt with cases where discretion was exercised in favour of the applicant by the Original Authority under Section 125 of the Customs Act 1962 by granting redemption which was not interfered with by the High Court - But in the instant case the Original Authority the Appellate Authority as well as the Revisional Authority viz. the 1st respondent herein have concurrently held that the petitioner is not entitled for redemption of the confiscated foreign and Indian currencies. Admittedly the confiscation order passed in respect of foreign and Indian currencies seized from the petitioner has also attained finality. Therefore it is clear that the petitioner has violated the Regulation 5 of Foreign Exchange Management (Export and Import Currency) Regulations 2015. Under Section 125 of the Customs Act 1962 it is a discretionary power - Having exercised the discretion by giving sound reasons the question of interference by this Court exercising powers under Article 226 of the Constitution of India in respect of the orders which have been challenged in this writ petition will not arise. This Court is not an Appellate Court and only when the orders challenged are perverse the question of interference with regard to those orders will arise. The reasons given by authorities for rejecting the petitioner s application under Section 125 of the Customs Act are sound and justifiable. Here is a case where all the three authorities who have passed the orders which have been impugned in this writ petition have consistently held that the petitioner is not entitled for redemption. When it is not in dispute that the petitioner has violated Regulation 5 of Foreign Exchange Management (Export and Import Currency) Regulations 2015 and that too when the confiscation order has attained finality and that too when the impugned orders are not perverse this Court while exercising powers under Article 226 of the Constitution of India has to necessarily reject this writ petition as it is bereft of any merit. This writ petition is dismissed.

Summary

Issues:
1. Correct exercise of discretion by the Original Authority under Section 125 of the Customs Act, 1962 for redemption of confiscated currencies.

Analysis:
The main issue in this case revolves around whether the Original Authority correctly exercised its discretion in rejecting the petitioner's application for redemption of confiscated Indian and foreign currencies under Section 125 of the Customs Act, 1962. The petitioner contended that even for prohibited goods, redemption can be sought under this section. The petitioner had carried excess currencies while traveling, leading to their confiscation under the Customs Act. The Original Authority rejected the redemption application citing the petitioner's declared income and the discrepancy in the amount of currency carried compared to his income.

The petitioner escalated the matter by filing appeals, first before the Commissioner of Customs (Appeals) and then a revision before the 1st respondent, all of which upheld the rejection of the redemption application. The 2nd respondent argued that the authorities exercised their discretion judiciously and that interference through Article 226 of the Constitution of India was unwarranted. The petitioner's counsel relied on previous judgments to support the argument that discretion was not judiciously exercised by the Original Authority.

The Original Authority's detailed rejection order highlighted the discrepancy between the currency amount seized and the petitioner's declared income, casting doubt on the ownership of the funds. The Appellate and Revisional Authorities upheld this decision, emphasizing the violation of Foreign Exchange Management Regulations and the finality of the confiscation order. They concluded that the petitioner was not entitled to redemption under Section 125 of the Customs Act, 1962 due to the violation and the sound reasoning provided by the authorities.

In comparison to the judgments cited by the petitioner's counsel, where redemption was granted after judicious exercise of discretion, in this case, all authorities consistently held that redemption was not warranted. The court highlighted that when orders are not perverse, interference through Article 226 is not justified. Given the violation of regulations, finality of confiscation, and the authorities' justifiable reasons, the court dismissed the writ petition, emphasizing the lack of merit and rejecting any interference through Article 226.

In conclusion, the court upheld the decisions of the Original, Appellate, and Revisional Authorities, emphasizing the discretionary power under Section 125 of the Customs Act, 1962 and the justifiability of the reasons provided for rejecting the redemption application.