Customs Act Violation: Goods Released Due to Exceeded Jurisdiction

The Tribunal found that the Principal Additional Director General, DRI, exceeded his jurisdiction by denying provisional release and failing to comply with legal provisions. Consequently, the seized goods were ordered to be released to the appellant, emphasizing adherence to the statutory requirements of the Customs Act, 1962. The appeal was disposed of, with the seized goods to be released to the appellant.

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Issues Involved:
1. Authority of Customs Officers for Seizure and Confiscation
2. Provisional Release and Unconditional Release of Seized Goods
3. Compliance with Section 110(2) of the Customs Act, 1962
4. Burden of Proof under Section 123 of the Customs Act, 1962

Summary:

Authority of Customs Officers for Seizure and Confiscation
The dispute involves the denial of access to property seized under the Customs Act, 1962. The appellant argued that the seizure did not occur at the frontiers, and the officers lacked the essential elements in the notice for adjudication to be credible enough to survive appellate scrutiny. The Tribunal noted that the seizure of 31.906 kg of gold and Rs. 73,23,400 in Indian currency by the Directorate of Revenue Intelligence (DRI) from the appellant's premises was not followed by proper show cause notices, which is a significant procedural lapse.

Provisional Release and Unconditional Release of Seized Goods
The appellant sought provisional release under section 110A and unconditional release under section 110 of the Customs Act, 1962, but faced no response from the authorities. The Principal Additional Director General, DRI, denied these requests, leading to a writ petition in the High Court of Bombay. The Tribunal found that the seizing agency failed to comply with the directions of the High Court and the provisions of the Customs Act, 1962, regarding the provisional release and retention of seized goods.

Compliance with Section 110(2) of the Customs Act, 1962
The appellant contended that the impugned goods should not have been proceeded against under section 124 of the Customs Act, 1962, without notice to them. The Tribunal noted that the show cause notice was issued but did not comply with section 110(2) of the Customs Act, 1962, as it was not issued within the stipulated timeline. The Tribunal emphasized that the statute does not permit alienation of the owner from seized goods without proper notice and adjudication.

Burden of Proof under Section 123 of the Customs Act, 1962
The Tribunal highlighted that under section 123 of the Customs Act, 1962, the burden of proving that the seized goods are not smuggled lies on the person from whose possession the goods were seized. The appellant argued that no other claimants to the ownership of the impugned goods were mentioned, and the Customs Act, 1962, does not empower officers to fasten ownership of goods without proper adjudication. The Tribunal agreed, stating that the failure to ensure strict fulfillment of section 123 cannot be overcome by adjudicatory restraint.

Conclusion
The Tribunal concluded that the Principal Additional Director General, DRI, exceeded his jurisdiction by denying provisional release and that the impugned order failed to comply with the legal provisions. The Tribunal ordered the release of the seized goods to the appellant, emphasizing the importance of adhering to the statutory requirements of the Customs Act, 1962.

Order:
The appeal is disposed of, and the seized goods are to be released forthwith to the appellant. (Order pronounced in the open court on 13/07/2023)

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