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Issues Involved:
1. Compliance with Section 110(2) of the Customs Act, 1962. 2. Compliance with Section 79 of the Gold (Control) Act, 1968. Detailed Analysis: Issue 1: Compliance with Section 110(2) of the Customs Act, 1962 The primary question under this issue was whether non-compliance with Section 110(2) of the Customs Act, 1962, which mandates the issuance of a notice within six months of the seizure of goods, would bar the initiation of proceedings for confiscation and imposition of penalty under Section 124 of the Act. The court examined the relevant provisions, including Section 110, which allows the seizure of goods liable to confiscation and requires a notice to be issued within six months, and Section 124, which mandates a show-cause notice before confiscation or imposition of penalty. The court referred to the Supreme Court's decisions in *Asst. Collector, Customs v. Malhotra, A.I.R. 1972 S.C. 689* and *I.J. Rao v. Bibhuti Bhushan Bagh, A.I.R. 1989 S.C. 1884*. These cases established that the person from whose possession the goods were seized must be given notice before extending the period of detention of the goods. However, the court clarified that these decisions did not imply that the failure to issue a notice within six months would invalidate the entire confiscation proceedings. Instead, non-compliance would only entitle the person to the return of the seized goods. The court also cited the Supreme Court's ruling in *Chaganlal Gainmull v. Collector of Central Excise and Others, 1990 (Supp.) Supreme Court Cases 527*, which held that the delay in issuing a show-cause notice affects the power to detain the goods but does not nullify the adjudication proceedings. The court concluded that non-issuance of a notice within the prescribed time would result in the return of the goods but would not preclude the continuation of adjudication proceedings. Issue 2: Compliance with Section 79 of the Gold (Control) Act, 1968 The second issue was whether the failure to issue a valid notice under Section 79 of the Gold (Control) Act within the prescribed period would preclude proceedings for confiscation and imposition of penalty. Section 79 of the Gold (Control) Act similarly requires a notice within six months of the seizure of gold, with a provision for extension by the Collector of Central Excise or Customs. The court noted that the provisions under the Gold (Control) Act are similar to those under the Customs Act. The failure to issue a notice within the prescribed time would only necessitate the return of the seized gold but would not invalidate the adjudication proceedings. The court emphasized that the adjudication process could continue even after the return of the goods. Conclusion: The court provided a conjoint answer to both issues, stating: (i) Both under the Customs Act and the Gold Control Act, failure to issue a notice within the time enjoined by law would only create an obligation on the part of the authority concerned to return the seized goods but would not hamper or preclude the continuance of the adjudication proceedings for confiscation or for levying of penalty, etc. This judgment clarifies that non-compliance with the notice provisions under the respective Acts results in the return of the seized goods but does not terminate the adjudication proceedings.
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