9911796707
TMI Blog2009 (9) TMI 38X X X X Extracts X X X X X X X X Extracts X X X X ..... ondent no.3 has not put any appearance though served. 2. By this petition, the petitioner seeks a mandamus or a direction or order directing the Union of India and the customs authorities to forthwith release the Hot Mix Paver Machine seized by them from the premises of the petitioner under the seizure memo dated 14th November 2008. 3. The respondent no.3 imported Hot Mix Paver Machine bearing model No. M/CS1800, SI No. 06681674 (for short "the machine") through WIRTGEN India Pvt. Ltd., Bangalore in the month of October 2005 without payment of customs duty as an actual user in view of an exemption allowed to actual users. The machine was insured by it with ICICI Lombard General Insurance Co. for a sum of Rs.9,29,89,400/. The machine met with an accident in or about January 2007. The respondent no.3 reported the accident to the insurance company. After the inspection, the insurance company was of the view that the machine could not be repaired and brought back to its original condition and was required to be discarded. The insurance company settled the claim of the respondent no.3 on a total loss basis and paid the settled amount to the respondent no.3 after deducting its ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1) of the Act says that where a proper officer has reason to believe that any goods are liable to confiscation under the Act, he may seize such goods. Subsection (2) of section 110 says that where any goods are seized under subsection (1) and no notice in respect thereof is given under clause (a) of section 124 within 6 months from the seizure of the goods, the goods shall be returned to the person from whose possession they were seized. Proviso to subsection (2) of section 110 of the Act empowers the Commissioner of Customs, on sufficient cause being shown, to extend the period within which the notice is to be given by a further period not exceeding 6 months. In P. Kishanchand Pvt. Ltd. (supra), a Division Bench of this Court, to which one of us (Rebello, J.) was a party, has held that the notice under section 110(2) of the Act is required to be given within 6 months with a power to the Commissioner for sufficient cause to further extend the period of 6 months from the date of seizure. There is however no provision to extend the period beyond 6 months and notice under section 110(2) must be given in any event within 12 months from the date of seizure. The notice mentioned under s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1) If the proper has reason to believe that any goods are liable to confiscation under this Act, he may seize such goods. Provided that where it is not practicable to seize any such goods, the proper officer may serve on the owner of the goods an order that he shall not remove, part with, or otherwise deal with the goods except with the previous permission of such officer. (2) Where any goods are seized under subsection (1) and no notice in respect thereof is given under clause (a) of section 124 within six months of the seizure of the goods, the goods shall be returned to the person from whose possession they were seized. Provided that the aforesaid period of six months may, on sufficient cause being shown, be extended by the [Commissioner of Customs] for a period not exceeding six months." [Other subsections, being not relevant, are not quoted.] "124. Issue of showcause notice before confiscation of goods, etc. - No order confiscating any goods or imposing any penalty on any person shall be made under this Chapter unless the owner of the goods or such person- (a) is given a notice in writing informing him of the grounds on which it is proposed to confiscate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ically excludes such opportunity. Even where the statute specifically excludes the opportunity of being heard, Courts would be entitled to consider the legality and constitutional validity of such a provision but, in any event, where the statute does not exclude their observance, the authority passing the order affecting civil rights of a person must follow the principles of natural justice which include giving of a reasonable opportunity of being heard to the person affected. It is in this light that we must interpret the provisions of section 110(2) read with section 124 of the Act. Where an importer of goods transfers the goods, may be in violation of a condition of import, the transferee may not necessarily know that the goods are being transferred in breach of any condition prohibiting the transfer. The transferee, who has bonafidely purchased the imported goods for consideration without notice of any breach of condition of import or violation of any prohibition, may be in possession of the goods. Though section 110 confers a power on the customs authorities to seize the goods from possession of such transferee even without notice, subsection (2) of section 110 read with secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Malhotra (supra), watches of foreign make were seized from the custody of the respondent on 19th March 1963. On production of vouchers for part of watches seized, they were released on 18th September 1963 and 27th February 1964. The balance of the watches for which vouchers could not be produced were not released by the customs authorities. On 6th March 1964, the customs authorities served on the respondent a notice under section 124(a) of the Act to show cause why the rest of the watches should not be confiscated. The notice was obviously issued beyond the period of 6 months from the seizure but the customs authorities claimed that an order of extension of time was passed by the Collector under section 110(2) of the Act. The orders of extension were admittedly passed exparte. The High Court directed release of the goods and on appeal, the Supreme Court confirmed the decision of the High Court. The Supreme Court held that on failure to issue show cause notice within 6 months, a civil right accrued to the respondent to have possession of the goods and since the order granting extension sought to defeat the right, the order for extension of time could not be passed without giving an ..... 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