1998 (8) TMI 161 - HC - Customs

Summary

Issues Involved:
1. Legality of the seizure of goods by Customs authorities.
2. Compliance with Section 110(2) of the Customs Act, 1962 regarding the issuance of notice within six months of seizure.
3. Validity of the claim that goods were mixed up and not checked by the petitioner.
4. Justifiability of the reasonable belief for seizure under Section 110 of the Customs Act, 1962.
5. Application of the Export and Import Policy, 1992-97 concerning prohibited goods.

Detailed Analysis:

1. Legality of the seizure of goods by Customs authorities:
The petitioner challenged the legality of the seizures made on 3-3-1994, 10-3-1994, and 7-4-1994 by the Customs authorities, arguing that there was no material before the proper officer to justify the belief that the goods were liable to confiscation under the Customs Act, 1962. The court found that the seizures were conducted under a reasonable belief that the goods were liable to confiscation, based on relevant and germane materials. The court referenced precedents indicating that the sufficiency of the material is not open to judicial review once it is established that there was relevant material to form a reasonable belief.

2. Compliance with Section 110(2) of the Customs Act, 1962 regarding the issuance of notice within six months of seizure:
The petitioner argued that no notice had been given under Clause (a) of Section 124 of the Customs Act, 1962 within six months of the seizure, entitling them to get back the seized goods under Section 110(2). The court found that the show cause notice for confiscation was issued on 18-8-1994, within six months from the dates of seizure, and was addressed to the petitioner and one of its partners, Chandra Prakash Bharech. The court held that service of notice on a partner amounts to good service on the partnership firm, thereby fulfilling the requirements of Section 124 of the Customs Act, 1962.

3. Validity of the claim that goods were mixed up and not checked by the petitioner:
The petitioner claimed that the goods of India Sales International and their own were mixed up in the wagon and not checked upon arrival at Howrah. The court found this claim difficult to believe, noting inconsistencies in the petitioner's statements and the lack of documentary evidence to support the claim. The court emphasized that these aspects could be properly decided on evidence by the competent authority under the Customs Act, 1962.

4. Justifiability of the reasonable belief for seizure under Section 110 of the Customs Act, 1962:
The court reiterated that the reasonable belief for seizure must be judged from the perspective of the experienced customs officer. The court found that the customs authorities had relevant and germane materials to form a reasonable belief that the goods were liable to confiscation. The court referenced the Affidavit-in-Opposition, which detailed the circumstances and evidence leading to the seizures, including the concealment of sandalwood pieces, a prohibited item under the Export and Import Policy.

5. Application of the Export and Import Policy, 1992-97 concerning prohibited goods:
The court examined the Export and Import Policy, which prohibited the export of sandalwood in any form except fully finished handicrafts and machine-finished products. The court noted that whether the seized goods fell under the exclusionary provision would be decided by the competent authority under the Customs Act, 1962.

Conclusion:
The court dismissed the appeal, holding that the seizures were made in accordance with the provisions of the Customs Act, 1962, and that the petitioner was not entitled to get back the seized goods. The court directed the petitioner to pay the costs of litigation and rejected the oral prayer for a stay of the judgment's operation.