2025 (5) TMI 270 - HC - Customs

Sikh Tourist's Gold Kada Recognized as Personal Effect, Customs Detention Overturned Under Baggage Rules, 2016

The HC ruled in favor of the Petitioner, finding that a gold kada worn by a Sikh tourist constitutes a personal effect under Baggage Rules, 2016. The ... Seeking exemption from detention - gold kada seized from the Petitioner at the airport constitutes a personal effect under the Baggage Rules, 2016 or not - Petitioner has requested not to receive the Show Cause Notice and personal hearing - HELD THAT:- Clearly, a perusal of the photographs and the fact that it is one Kada which is usually worn by persons like the Petitioner who are Sikhs, leaves no doubt in the mind of the Court that the same was a personal effect of the Petitioner. Moreover, in the cases of Mr Makhinder Chopra vs. Commissioner of Customs, New Delhi [2025 (3) TMI 19 - DELHI HIGH COURT]] and Amit Kumar v. The Commissioner of Customs [2025 (2) TMI 385 - DELHI HIGH COURT] this Court has discussed various issues arising in such cases where the goods have been detained from a tourist by the Customs Department, including the issue of personal jewellery being part of personal effects under the Baggage Rules, 2016 and waiver of SCN and personal hearing by way of a preprinted waiver form. Conclusion - Considering the fact that the gold kada seized is merely a personal effect of the Petitioner, in the opinion of this Court, the detention itself would be contrary to law. The detention of the gold kada is set aside. Petition disposed off. 1. ISSUES PRESENTED and CONSIDEREDThe core legal questions considered by the Court are:Whether the gold kada seized from the Petitioner at the airport constitutes a personal effect under the Baggage Rules, 2016, and therefore exempt from detention by the Customs Department.Whether the practice of obtaining a pre-printed waiver of the Show Cause Notice (SCN) and personal hearing from tourists, as done in this case, is legally valid under Section 124 of the Customs Act.Whether the detention of the gold kada without issuance of SCN and without providing an opportunity of personal hearing is sustainable in law.2. ISSUE-WISE DETAILED ANALYSISIssue 1: Whether the gold kada is a personal effect exempt from detention under the Baggage Rules, 2016The legal framework relevant to this issue includes the Baggage Rules, 2016, which define personal effects and provide exemptions for bona fide personal jewellery worn by tourists. The Court relied heavily on precedents, particularly two recent decisions of the same Court:Mr Makhinder Chopra vs. Commissioner of Customs (2025:DHC-1162-DB)Amit Kumar v. The Commissioner of Customs (2025:DHC:751-DB)In Makhinder Chopra, the Court clarified that jewellery genuinely worn by tourists as personal effects falls within the ambit of the Baggage Rules and is not liable for detention. The Court emphasized the need for Customs authorities to distinguish between mere jewellery and personal jewellery used bona fide by the traveller. The Court also underscored the cultural and religious significance of such items, such as a gold kada worn by Sikh individuals, reinforcing that such items are personal effects.In the present case, the Petitioner, a Sikh tourist, was wearing a single 22 carat gold kada weighing 60 grams. Photographic evidence was submitted to establish that the kada was indeed worn by the Petitioner. The Court found no doubt that the kada was a personal effect, consistent with the principles laid down in the aforementioned precedents.Applying these principles, the Court concluded that the gold kada is exempt from detention under the Baggage Rules as it is a bona fide personal jewellery item worn by the Petitioner.Issue 2: Validity of the waiver of Show Cause Notice (SCN) and personal hearing obtained through a pre-printed formThe Customs Department had obtained a signed pre-printed form from the Petitioner, wherein the Petitioner purportedly waived the right to receive an SCN and personal hearing, requesting the case to be decided on merits.The Court referred to the binding precedents of Makhinder Chopra and Amit Kumar, which held that such a practice is contrary to the provisions of Section 124 of the Customs Act. Section 124 mandates the issuance of an SCN and provides for an opportunity of personal hearing before confiscation or detention of goods.In Amit Kumar, the Court held that a printed waiver of SCN and personal hearing cannot substitute the statutory requirement of issuing an SCN and conducting a hearing. The Court declared that detention without issuance of SCN and hearing is unsustainable in law.Applying this reasoning, the Court held that the signed waiver form cannot be deemed a valid SCN or hearing, rendering the detention of the gold kada unlawful.Issue 3: Legality of detention of the gold kada without issuance of SCN and personal hearingGiven the findings on Issue 2, the Court examined whether the detention of the gold kada was legally sustainable. The Court reiterated that Section 124 of the Customs Act requires the Customs Department to follow principles of natural justice, including issuance of SCN and personal hearing before detention or confiscation.Since the Petitioner was not issued an SCN and was deprived of a personal hearing, and considering the gold kada was a personal effect exempt under the Baggage Rules, the Court found the detention to be contrary to law.The Court accordingly set aside the detention and ordered release of the gold kada subject to payment of warehouse charges within four weeks.3. SIGNIFICANT HOLDINGSThe Court made the following crucial legal determinations:'A conspectus of the above decisions and provisions would lead to the conclusion that jewellery that is bona fide in personal use by the tourist would not be excluded from the ambit of personal effects as defined under the Baggage Rules. Further, the Department is required to make a distinction between 'jewellery' and 'personal jewellery' while considering seizure of items for being in violation of the Baggage Rules.''Since, the Court has made clear that the practice of making tourists sign undertaking in a standard form waiving the show cause notice and personal hearing is contrary to the provisions of Section 124 of the Act, hereinafter, the Customs Department is directed to discontinue the said practice. The Customs Department is expected to follow the principles of natural justice in each case where goods are confiscated in terms of Section 124 of the Act.''The printed waiver of SCN and the printed statement made in the request for release of goods cannot be considered or deemed to be an oral SCN, in compliance with Section 124. The SCN in the present case is accordingly deemed to have not been issued and thus the detention itself would be contrary to law. The order passed in original without issuance of SCN and without hearing the Petitioner, is not sustainable in law.'The Court conclusively held that the gold kada was a personal effect exempt from detention, the waiver of SCN and hearing was invalid, and the detention was unlawful. The order of detention was set aside and the gold kada ordered released subject to warehouse charges.