Prior notice before extending customs seizure time protects the right to restoration of goods, with limited hearing safeguards.

A proposed extension of time to issue notice under Section 110(2) of the Customs Act must be based on sufficient cause shown on objective material, because the extension can postpone the seized person's entitlement to restoration of the goods if notice is not issued within six months. For that reason, natural justice requires prior notice and an opportunity to be heard before extension is granted, limited to contesting the need for more time and without disclosure of confidential investigative details. If prior service cannot be completed in time, a post-decisional hearing may be given.

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Issues: (i) Whether the Collector of Customs must issue notice to the person from whose possession goods were seized before extending the period for issuance of notice under Section 110(2) of the Customs Act, 1962.

Issue (i): Whether the Collector of Customs must issue notice to the person from whose possession goods were seized before extending the period for issuance of notice under Section 110(2) of the Customs Act, 1962.

Analysis: The proviso to Section 110(2) requires that extension beyond six months be granted only on sufficient cause being shown. That expression requires an objective consideration by the Collector on the basis of material placed before him, and the extension affects the seizing party's immediate entitlement to restoration of the goods if notice is not issued within six months. Since the extension may prejudice that right, principles of natural justice require that the affected person be informed of the proposal and be heard. The opportunity is limited to showing why time should not be extended and does not extend to disclosure of confidential details of the investigation. Where service of prior notice cannot be completed despite issue within time, a post-decisional hearing may follow the extension.

Conclusion: Yes. Notice to the person from whose possession the goods were seized is required before extension of time under Section 110(2), subject to the limitation that the investigation need not be disclosed and a post-decisional hearing may be afforded where prior service is not possible in time.

Final Conclusion: The High Court's order was modified and the customs authorities' power to seek extension under Section 110(2) was upheld, while procedural fairness was confined to notice and hearing within the limits stated above.

Ratio Decidendi: When a statutory extension of time may defeat an affected person's accrued entitlement to restoration of seized goods, the decision-maker must afford notice and an opportunity of hearing before granting the extension, unless circumstances justify a post-decisional hearing.

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