2024 (7) TMI 1121 - HC - Customs

Challenge to Exhibit P-4 notice issued under Section 150 of the Customs Act, 1962 - seizure of Gold and Liquor - disposal of the seized gold under Section 110 (1A) of the Act - no prosecution for any offence committed - HELD THAT - The gold is not a perishable item. The petitioner has not been prosecuted for any offence committed by him. No charge sheet has been filed against him and he was not taken into custody. Merely on the ground of statement recorded under Section 110 of the Act, the gold items seized from the petitioner are being disposed of under Section 150 of the Act. The question whether without following the procedure for adjudication by issuing a show cause notice can be resorted to for disposal of the gold items came for consideration before the Delhi High Court in the case of ZHINET BANU NAZIR DADANY VERSUS UNION OF INDIA ANR. 2019 (5) TMI 1252 - DELHI HIGH COURT . Thus, merely on the ground of statement recorded under Section 110 of the Act, the authorities should not proceed to dispose of the seized items if the same are not perishable and before disposal, adjudication proceedings must preceed - the impugned notice under Section 150 of the Act in Exhibit P-4 is set aside. The respondents are directed to issue show cause notice to the petitioner and thereafter adjudicate the matter and proceed further. Petition disposed off.

Summary

Issues involved:
1. Impugning Exhibit P-4 notice under Section 150 of the Customs Act, 1962.
2. Seizure of gold and liquor from the petitioner.
3. Lack of show cause notice and adjudication proceedings.
4. Disposal of seized items without following proper procedure.

Analysis:
1. The petitioner challenged the Exhibit P-4 notice issued under Section 150 of the Customs Act, 1962, regarding the disposal of seized gold. The petitioner arrived from Dubai and was intercepted at the airport for carrying undeclared gold and excess liquor. The authorities proceeded to issue the notice solely based on the petitioner's statement under Section 110 without issuing a show cause notice or conducting adjudication.

2. The petitioner was found carrying undeclared gold and excess liquor beyond the prescribed limits. The authorities discovered a gold bangle and chain with the petitioner, which he claimed belonged to someone else. The petitioner also had liquor gifted by friends. Despite the seizure, no prosecution, charge sheet, or custody was initiated against the petitioner.

3. The petitioner contended that the disposal of non-perishable seized items without following the adjudication procedure was unjust. Citing a previous judgment by the Delhi High Court, it was argued that disposal without notice to the petitioner was improper. The Court noted that under Section 110 (1) (1A) of the Act, disposal should not occur solely based on the recorded statement if the items are non-perishable, emphasizing the need for adjudication proceedings.

4. The Court, considering the Delhi High Court's judgment and the relevant provisions of the Act, held that the authorities should not hastily dispose of seized items based only on the petitioner's statement. The Court set aside the impugned notice under Section 150 of the Act and directed the authorities to issue a show cause notice, conduct adjudication, and proceed accordingly. The writ petition was finally disposed of with these directions.