Customs Act: Writ Appeal Dismissed, Warehouse Sealing Legal. Show Cause Notice Extension & Goods Seizure Upheld.

The court dismissed the writ appeal, affirming the legality of sealing the warehouse under Section 110 of the Customs Act, the extension of the period for issuing a show cause notice under Section 124, and the seizure of goods lacking proper documentation. The investigation was ordered to be promptly concluded, and the godown could not be unsealed until the completion of proceedings related to the seized goods.

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Issues Involved:
1. Legality of sealing the warehouse under Section 110 of the Customs Act.
2. Requirement to return seized goods due to lapse of the six-month period under Section 110(2) of the Customs Act without issuing a show cause notice under Section 124.
3. Validity of the seizure of goods not related to Bill of Entry No.3325365.

Issue-wise Detailed Analysis:

1. Legality of Sealing the Warehouse Under Section 110 of the Customs Act:
The appellant contended that Section 110 of the Customs Act does not empower Customs authorities to seal a warehouse. However, the respondents argued that Section 110 encompasses the power to seal a godown if there is reason to believe that goods liable for confiscation are stored there. The court referenced the Madhya Pradesh High Court judgment in Vilayat Hussain Vs. Union of India, which supports the view that sealing a godown is permissible under Section 110 as a preventive measure to restrain the godown owner from using it for storing illegally removed goods. The court concluded that sealing the godown was within the scope of Section 110, especially since the premises were found to contain goods without proper documentation, believed to be removed using forged documents.

2. Requirement to Return Seized Goods Due to Lapse of the Six-Month Period Under Section 110(2) of the Customs Act Without Issuing a Show Cause Notice Under Section 124:
The appellant argued that since no notice under Section 124 was issued within six months of the seizure, the goods should be returned. They cited several judgments to support this claim. However, the respondents countered that a show cause notice dated 18.04.2018 was issued to extend the period for issuing a notice under Section 124 by another six months, and an order dated 24.04.2018 extended this period. The court noted that the extension order was valid and had not been challenged, thereby negating the appellant's claim for the return of goods based on the lapse of the six-month period.

3. Validity of the Seizure of Goods Not Related to Bill of Entry No.3325365:
The appellant contended that the seized goods did not pertain to Bill of Entry No.3325365 and were imported under valid bills of entry. They argued that the Customs Authority had no right to seize these goods. The court observed that the goods were found without proper documentation and appeared to have been removed from the customs warehouse using forged documents. The appellant, being a transporter, claimed the goods belonged to other customers who had not come forward to claim them, raising suspicion about the legality of the goods. The court held that the investigation into these goods was ongoing, and the extension of the period for issuing a show cause notice was valid. Therefore, desealing the godown could not be permitted until the investigation was completed and proceedings under Section 124 reached finality.

Conclusion:
The court dismissed the writ appeal, upholding the legality of sealing the warehouse under Section 110, the extension of the period for issuing a show cause notice under Section 124, and the seizure of goods found without proper documentation. The investigation was directed to be completed forthwith, and desealing of the godown was not permitted until the finality of the proceedings.

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