Court upholds gold seizure legality, notice validity, rejects Customs Act proceeding drop request. Petitioner to respond to show-cause.

The Court dismissed the Writ Petition, affirming the legality of non-releasing the seized gold, validating the notices issued within the extended limitation period, and rejecting the request to drop the proceedings initiated under the Customs Act, 1962. The Petitioner was instructed to respond to the show-cause notice for the adjudicating authority to make a decision. No costs were awarded.

---

---

Issues Involved:
1. Legality of the non-release of seized gold under Section 110(2) of the Customs Act, 1962.
2. Validity of notices dated 26.03.2020 and 27.05.2020 issued by the customs authorities.
3. Request for the release of seized gold weighing 699.88 grams valued at Rs. 27,08,136.00.
4. Request to drop proceedings initiated under the Customs Act, 1962.

Detailed Analysis:

1. Legality of the Non-Release of Seized Gold under Section 110(2) of the Customs Act, 1962:
The Petitioner argued that the seizure of gold bars on 04.10.2019 was illegal since no notice under Section 124(a) of the Customs Act was issued within six months, as required by Section 110(2). The Respondents countered that the competent authority had extended the period for issuing the notice, and the extension was communicated to the Petitioner. The Court noted that the proviso to Section 110(2) allows for an extension of up to six months by the Principal Commissioner or Commissioner of Customs, provided reasons are recorded in writing and communicated before the expiry of the initial six months. The Court found that the Respondents complied with this requirement, and the extension was valid.

2. Validity of Notices Dated 26.03.2020 and 27.05.2020:
The Petitioner sought to quash the notices dated 26.03.2020 and 27.05.2020, arguing they were issued beyond the permissible period. The Respondents justified the notices by citing the Supreme Court's order dated 23.03.2020 in Writ Petition (Suo Motu) No. 3 of 2020, which extended the period of limitation due to the Covid-19 pandemic. The Court acknowledged the Supreme Court's order and the Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020, which extended the limitation period to 29.09.2020. Therefore, the Court held that the notices were validly issued within the extended period.

3. Request for the Release of Seized Gold:
The Petitioner requested the release of the seized gold, claiming it was not smuggled but purchased by his father for his sister's marriage. The Respondents argued that the gold bars were of foreign origin and suspected to be smuggled. The Court observed that the show-cause notice dated 21.09.2020 was issued within the extended limitation period, thus fulfilling the requirements under Section 124(a) of the Customs Act. Consequently, the Court held that the seized gold could not be returned to the Petitioner under Section 110(2) as the show-cause notice was issued within the permissible period.

4. Request to Drop Proceedings Initiated Under the Customs Act, 1962:
The Petitioner sought to drop the proceedings initiated under the Customs Act, 1962. The Court noted that the issuance of the show-cause notice within the extended period meant that the proceedings were legally valid. The Court emphasized that the Petitioner should respond to the show-cause notice so that the adjudicating authority could pass an appropriate order in accordance with the law. Therefore, the Court held that dropping the proceedings at this stage was not warranted.

Conclusion:
The Court dismissed the Writ Petition, holding that the non-release of the seized gold was legal, the notices dated 26.03.2020 and 27.05.2020 were validly issued within the extended limitation period, and the request to drop the proceedings was not justified. The Petitioner was advised to respond to the show-cause notice for the adjudicating authority to pass an appropriate order. No order as to costs was made.

---