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2019 (9) TMI 1283 - HC - CustomsSmuggling - Betel Nuts - Provisional release of seized goods - N/N. 9/96 (NT) Cus, dated 22.01.96 issued under Section 11 of the Customs Act, 1962 read with Section 3(2) of the Foreign Trade (Development and Regulation) Act, 1992 - HELD THAT - In the present case, since the Food Laboratory Report has found that the Betel Nut are not fit for human consumption, in the opinion of this Court, no fault may be found with the rejection of the request of the petitioners for grant of release. Sustainability of seizure - Learned counsel for the Union of India, Department of Customs has submitted that the developments so far may persuade this Court not to interfere with the seizure at this stage when the matter is still under investigation and a complete view may be taken as regards the foreign origin after obtaining a report from the accredited lab - HELD THAT - This Court is of the considered opinion that in the given facts and circumstances of the case, where the matter is still under investigation and even some accredited labs have come into existence, this Court need not interfere with the seizure of the Betel Nuts at this stage and this issue be kept open for consideration at appropriate stage after the investigation is over and the respondents receive a report as regards the country of origin from an accredited lab within a period of three months by following the established procedures. Application dismissed.
Issues Involved:
1. Quashing of the Memo of Seizure dated 06.02.2019. 2. Quashing of the Consequential Letter No. 2647 dated 02.04.2019. 3. Quashing of the provisional release order dated 04.04.2018. 4. Direction for the release of the seized goods pending disposal of the writ application. Issue-wise Detailed Analysis: 1. Quashing of the Memo of Seizure dated 06.02.2019: The petitioners argued that the seizure of 15865 Kgs of Betel Nuts and the truck was arbitrary and beyond the jurisdiction of the respondents. They contended that the seizure was based on an alleged violation of Notification No. 9/96 (NT)-Cus, which restricts imports from Nepal and does not apply to Betel Nuts as they are not "Notified Goods" under Section 11 of the Customs Act. The respondents justified the seizure under Section 110 of the Customs Act, asserting that the goods appeared to be of foreign origin and were suspected to be smuggled. The court found that the respondents' belief that the goods were liable to confiscation under the Act was reasonable, given the appearance and characteristics of the Betel Nuts, and upheld the seizure. 2. Quashing of the Consequential Letter No. 2647 dated 02.04.2019: The petitioners challenged the rejection of their application for provisional release of the Betel Nuts based on a Sample Test Report from the Central Food Laboratory (CFL), Kolkata, which declared the Betel Nuts unfit for human consumption. They argued that the sample collection was done without prior notice, making the report unreliable. The court noted that the CFL report found the Betel Nuts non-conforming to standards due to the presence of damaged nuts and added coloring matter, deeming them "unsafe food" under the Food Safety and Standards Act, 2006. The court upheld the rejection of the provisional release application, emphasizing the importance of ensuring food safety. 3. Quashing of the provisional release order dated 04.04.2018: The petitioners sought to quash the order requiring a cash security deposit of 20% of the truck's value for its provisional release. The court examined the guidelines for provisional release under Section 110-A of the Customs Act and Circular No. 35 of 2017, which stipulate conditions for provisional release, including compliance with statutory requirements. Given the CFL report's findings and the ongoing investigation into the goods' origin, the court found the provisional release conditions justifiable and did not quash the order. 4. Direction for the release of the seized goods pending disposal of the writ application: The petitioners requested the release of the seized Betel Nuts pending the writ application's disposal. The court referred to previous judgments where provisional release was directed under similar circumstances but noted that those cases did not involve reports declaring the goods unfit for consumption. The court emphasized that the current case involved significant food safety concerns and ongoing investigations to determine the goods' origin. Consequently, the court denied the request for provisional release, prioritizing public health and safety. Conclusion: The court dismissed the writ application, upholding the seizure of the Betel Nuts and the truck, the rejection of the provisional release application, and the conditions for the truck's provisional release. The court emphasized the importance of food safety standards and the need for thorough investigations to determine the goods' origin before considering their release.
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