2019 (1) TMI 1633 - HC - Customs

Court quashes orders rejecting Betel Nuts release, emphasizes need for standardized tests

M/s Ayesha Exports Versus The Union of India And Ors.

The court allowed the writ application, ruling in favor of the petitioner, and quashed the impugned orders rejecting representation for the release of ... Release of seized goods - Betel Nuts - the consignment of the petitioner is said to have been put under seizure alleging that the same seems to be of 'Indonesian Origin' - allegation based on test report of Arecanut Research and Development Foundation, Mangalore - HELD THAT:- This court is of the opinion that in absence of there being a standardized laboratory test for tracing the country of origin, established under some statute and such Labs have been accredited by the competent authority and the Labs could have the scientific method to come to a conclusion that a Betel Nut is of a particular country's origin, it would not be in the interest of justice to direct the petitioner to pay the custom's duty. Revenue submits that in fact on the basis of materials which are available on the record, in his opinion now the time has come when the Government of India will have to think over either continuing with the treaty in question or to develop a scientific method to find out the country of origin to save the government's revenue - In the opinion of this court, it is for the Government of India to think over it. Application allowed. Issues:Challenge to order rejecting representation for release of seized Betel Nuts based on Indonesian origin claim.Analysis:The writ application was filed to challenge the order rejecting the representation for the release of seized Betel Nuts, along with the seizure and test reports. The petitioner argued that the customs authorities lacked legal support for their actions and cited a previous judgment where a report from a similar institution was deemed insufficient for legal liability. Additionally, it was highlighted that no standardized laboratory test exists to determine the country of origin for Betel Nuts, as confirmed by the Directorate of Arecanut & Spices Development, Government of India.The petitioner further presented documents like the certificate of origin and import release order, indicating the genuineness of the consignment from Nepal. The Plant Protection Officer's inspection reports recommended the release of the Betel Nuts, complying with relevant regulations. The respondent's reliance on the ARDF test report, which suggested Indonesian origin, was contested based on the lack of legal sanctity for such reports, as established in a previous court judgment.The Additional Solicitor General of India attempted to justify the seizure based on the trading patterns of Betel Nuts from Nepal but failed to provide a satisfactory explanation for the claim of Indonesian origin. The court emphasized that without accredited laboratories with standardized tests for determining origin, imposing customs duty based on such reports would be unjust. It was concluded that the government may need to develop a scientific method for origin tracing to protect revenue, but until then, the petitioner was entitled to the relief sought in the writ application.In light of the arguments and evidence presented, the court allowed the writ application, quashing the impugned orders and ruling in favor of the petitioner.