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Issues:
1. Validity of the confiscation order under Section 115(2) of the Customs Act, 1962. 2. Compliance with the statutory period for issuing show cause notice under Section 110 of the Act. 3. Interpretation of the relationship between Sections 110 and 124 of the Act regarding show cause notices and confiscation proceedings. Analysis: 1. The appeal challenged the order imposing a fine under Section 115(2) of the Customs Act, 1962, instead of confiscating a van used for transporting contraband goods. The van was seized with foreign goods valued at Rs. 2,54,650. The appellant contested the confiscation, arguing that no show cause notice was served within the statutory period of six months, as required by Section 110 of the Act. 2. The appellant contended that the subsequent show cause notice issued after six months was legally untenable. The adjudicating authority held that even without a timely show cause notice, the authorities could proceed with confiscation under Section 124 of the Act. The Division Bench of the Madras High Court clarified the independence of Sections 110 and 124, emphasizing that non-compliance with the six-month period in Section 110 only affects the seizure, not the validity of the show cause notice under Section 124. 3. The judgment referenced various court decisions to support the interpretation that the statutory period under Section 110(2) does not limit proceedings under Section 124. While the Delhi High Court viewed non-compliance with the six-month period as fatal to confiscation proceedings, the Supreme Court's ruling and interpretations by other High Courts aligned with the Madras Bench's stance. The appellate tribunal upheld the confiscation order but reduced the fine due to the van's deterioration in custody since seizure. The judgment emphasized the distinction between the seizure-related time limit and the validity of adjudication proceedings under Section 124.
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