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TMI Blog2025 (3) TMI 19X X X X Extracts X X X X X X X X Extracts X X X X ..... period. The Supreme Court clearly holds that it is not permissible to completely exclude jewellery from the ambit of 'personal effects'. Accordingly, the Court declared that the seized jewellery items therein were the bona fide jewellery of the tourist for her personal use and was intended to be taken out of India. In Saba Simran v. Union of India & Ors. [2024 (12) TMI 19 - DELHI HIGH COURT] this Court was seized with the issue of deciding the validity of the seizure of gold jewellery by the Customs Department from an Indian tourist. The Court considered the ambit of 'personal effects' vis-à-vis jewellery under the Baggage Rules in effect from time to time. A conspectus of the above decisions and provisions would lead to the conclusion that jewellery that is bona fide in personal use by the tourist would not be excluded from the ambit of personal effects as defined under the Baggage Rules. Further, the Department is required to make a distinction between 'jewellery' and 'personal jewellery' while considering seizure of items for being in violation of the Baggage Rules." Thus, it is now settled law that the Customs Officials are required to consider the facts of each case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itioner's gold chain was unjustified. iii) The standard form used by the Customs Department for waiving show cause notice and personal hearing does not satisfy the requirements of Section 124 of the Customs Act, violating principles of natural justice.
The detention of the Petitioner's gold chain would be contrary to law and accordingly, the same is set aside - The gold chain of the Petitioner shall be released to the Petitioner subject to payment of any charges within four weeks - Petition disposed off. X X X X Extracts X X X X X X X X Extracts X X X X ..... e statement without any duress, pressure or threat". 8. In the present case, it is seen that the Petitioner was wearing a gold chain which has been valued at Rs. 6,52,190/- by the Department. Till date, no show cause notice has been issued on the ground that the issuance of the show cause notice has already been waived. II. Issues for consideration: 9. In this case there are two issues, which in the Court's opinion are arising in a number of cases before the Court where the goods of tourists of both Indian and foreign origin are being routinely detained by the Customs Department: (i) detention of jewellery or personal effects of a tourist, especially those of foreign origin, under the Baggage Rules, 2016; and (ii) undertaking in a standard format for wavier of show cause notice and personal hearing signed by the concerned tourist. III. Analysis and Findings: III.(A) Jewellery vis-à-vis personal effects under the Baggage Rules, 2016 10. It is necessary to appreciate the Baggage Rules, 2016 (hereinafter "the Baggage Rules") that came into force on 1st April, 2016, passed under Section 79 of the Customs Act, 1962 (hereinafter "the Act"). The relevant provisions of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s or are articles that are not prohibited, as mentioned in Annexure - I of the Baggage Rules, up to the value of fifteen thousand rupees, if the same are carried on the person or in the accompanied baggage of such tourist. 12. Further, any jewellery of twenty grams with a value cap of Rs. 50,000/- in case of a man and forty grams with a value cap of Rs. 1,00,000/- in case of a woman, only can be cleared free of duty upon return to India, subject to the condition that the concerned passenger is residing abroad for more than one year. 13. In the Guide for Travellers, prepared by the Central Board of Indirect Taxes & Customs (hereinafter "CBIC"), in respect of jewellery, it is stated as under:- "Question 6. Who can bring Jewellery as baggage, free of duty? Ans. An Indian passenger who has been residing abroad for over one year is allowed to bring jewellery, free of duty in his bona fide baggage upto 20 grams with a value cap of Rs. 50,000/- (in case of a gentleman passenger) or up to 40 grams with a value cap of Rs. 1,00,000/- (in the case of a lady passenger)." 14. The Indian Customs Declaration Form (hereinafter "Declaration Form") issued by the CBIC as part of the Guide for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d it is meant to be taken out of India with them and it is a prerequisite at the time of making endorsements on the passport. Therefore, bringing jewellery into India for taking it out with the passenger is permissible and is not liable to any import duty. * * * * 15. [...] Also, from the present facts and circumstances of the case, it cannot be inferred that the jewellery was meant for import into India on the basis of return ticket which was found to be in the possession of the respondent. Moreover, we cannot ignore the contention of the respondent that her parents at the relevant time were in Indonesia and she had plans of proceeding to Indonesia. Some of the jewellery items purchased by the respondent were for her personal use and some were intended to be left with her parents in Indonesia. The High Court has rightly held that when she brought jewellery of a huge amount into the country, the respondent did not seem to have the intention to smuggle the jewellery into India and to sell it off. Even on the examination of the jewellery for costing purposes, it has come out to be of Rs 25 lakhs and not Rs 1.27 crores as per DRI. The High Court was right in holding that it is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ragraphs of the said judgement are as under: "13. When the 2016 Rules ultimately came to be promulgated, Rule 2(vi) specifically introduced a definition with respect to "personal effects". As noticed in the preceding parts of this judgment, Rule 2(vi) while defining "personal effects" explicitly excludes items of jewellery. The word 'jewellery' as it now appears in that definition clause must necessarily be read in conjunction with the previous versions of the Baggage Rules which operated from time to time as well as the clarificatory Circular referred to above. However, both Rules 3(a) as well as 4(b) employ the phrase "used personal effects" and which expression existed even in the prior versions of the rules and have been noticed hereinabove. 14. Rule 2(vi) of the 2016 Rules essentially adopts the same concept of 'used personal effects' as was intended under the 1998 Rules, and by way of abundant caution, a definition now stands placed in the 2016 Rules and which purports to define the expression "personal effects" with sufficient clarity. However, the same would not detract from the distinction which the respondents themselves acknowledged in the Circular and intended custo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... extend to any article "carried on the person" as mentioned in Rule 3 of the Baggage Rules. The relevant portion of the said judgement is extracted hereinunder: "50. From a perusal of above provision, it is clear that the Clause (b) includes the articles other than those mentioned in Annexure-I, upto the value of fifty thousand rupees if these are 'carried on the person' or in the accompanied Baggage of the passenger 51. The Customs Act, 1962, enables the Central Government to make Rules to the extent of the articles carried in the baggage of a passenger and not for the articles, which were carried on the person and hence, the inclusion of the word " carried on the person " is beyond the scope of the provisions of Section 79 of the Customs Act. 52. When the provision of the Rule is beyond the scope of the provisions of the Act, only the provision of the Act will prevail over the Rules. Thus, the word "carried on the person up to Rs. 50,000/- " is clearly beyond the scope of the Act and it cannot be given any effect since it is contrary to the provisions of the Statute. Thus, it has to be construed only for the articles, which have not been mentioned in Annexure-1 and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us, in the present case, the Baggage Rule, 2016 will apply only to the baggage and the Rule made to the extent that the article "carried on the person" will not include baggage, which was in excess of powers conferred by the Rule making Authority and would amount to ultra vires. Therefore, the jewellery worn in person will not come under the purview of baggage. 63. Since this Court has held that the provision "as carried on the person" of the Baggage Rules, 2016 is ultra vires, the detention of gold under the Baggage Rules, 2016, in the present case would not apply, unless and otherwise if it is secreted in person, for which, the proceedings shall be initiated under Section 101 of the Customs Act, 1962, however, that is not the present case, except to the extent of false charges framed by the 2nd respondent against the petitioner." 19. Thus, it is now settled law that the Customs Officials are required to consider the facts of each case and apply their mind before detaining the goods of a tourist, either of Indian or foreign origin. The Customs Officials have to be conscious of the fact that personal effects including jewellery of tourists are protected by the law from detention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ravelling from Azerbaijan to India. This Court recently in Anjali Pandey vs. Commissioner of Customs, 2025:DHC:372-DB, has also directed release of the jewellery seized from a tourist of foreign origin relying on the decisions discussed hereinabove. 22. It is an undisputed fact that the Petitioner is a Russian passport holder. In view of the law discussed above, on the ground of limited applicability of the Baggage Rules to the tourist of foreign origin and as jewellery is part of personal effects, the detention of Petitioner's gold chain would have to be set aside. However, there is another aspect of this case which has bearing on the validity of the detention of the Petitioner's gold chain. III.(C) Waiver of show cause notice and personal hearing 23. As mentioned above, the Customs Department has relied upon the undertaking in a standard form dated 17th June, 2024 signed by the Petitioner, wherein the Petitioner has waived of issuance of the show cause notice and personal hearing. It is admitted position that no show cause notice has been issued to the Petitioner on the basis of the said undertaking. 24. The issuance of a show cause notice before confiscation of goods by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tracted hereinunder: "12. The Court has considered the matter. The main plank of the Respondent's submission is on the basis of the Standard Printed Form which is titled Green Channel Violation (Request for Release of Detained Goods) which has been extracted hereinabove. 13. A perusal of the above would show that in Printed Form, the following has been included:- "It is humbly requested that said detained goods may please be RELEASED. I regret my mistake of opting for Green Channel and further request you to please take a lenient view in the matter. I undertake that my case may be decided on merit and as such I do not want any written Show Cause Notice and Personal Hearing in the matter. An oral SCN has been received." 14. When a request for release of goods is being made by the person whose goods have been detained, the said person cannot be expected to read a printed form, where - * waiver of Show Cause Notice has been agreed to, * waiver of personal hearing has been agreed to and * it has also been recorded that an oral SCN has been received. Such signing of the standard form would not be in compliance with the principles of natural justice, inasmuch as, the waiv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on affected has also waived a right for personal hearing. Such a form in fact shocks the conscience of the Court, that too in cases of the present nature where travellers/tourists are made to run from pillar to post for seeking release of detained goods. 18. A Co-ordinate Bench of this Court recently in Mohammad Zaid Saleem vs. The Commissioner of Customs (Airport & General) [W.P.(C) No. 2595/2019], has held clearly that if a SCN is not given within six months of the seizure, the goods would be liable to be released. The relevant portion of the above stated judgment is extracted below: "Before parting with this petition, it is pertinent to note that the matters in issue in the present matter are squarely covered by decision in the case of Chaganlal Gainmull v. Collector of Central Excise, where it was held that if the show cause notice was not issued within six months from the date of seizure, the consequence would be that the person from whom the gold was seized would become entitled to its return. Although the aspect of extension of period of detention for another six months vide the Proviso to Section 110 (2) of the Act was introduced w.e.f 29.03.20184 the ratio still holds ..... X X X X Extracts X X X X X X X X Extracts X X X X
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