Customs recovery by attachment sustained where liability was final, but relief was conditioned on payment and compliance.

In customs recovery proceedings, attachment of a bank account and factory premises was treated as sustainable where the underlying liability had already attained finality and the detained goods had remained in custody for a long period. The court accepted substantial compliance with the recovery framework under Section 142 of the Customs Act, 1962, and held that the officials were not acting wholly without jurisdiction by invoking attachment rather than first selling the detained goods. At the same time, writ relief was moulded on equitable terms: the court balanced the amounts already recovered and the practical difficulty of selling obsolete goods, and made quashing of the attachment conditional on timely payment of the balance fixed by the court.

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Issues: (i) Whether the attachment of the petitioner's bank account and factory premises could be sustained under Section 142 of the Customs Act, 1962 without first exhausting recovery by sale of the detained goods; (ii) whether relief under Article 226 of the Constitution of India should be granted in view of the finality of the customs liability and the equities arising in the case.

Issue (i): Whether the attachment of the petitioner's bank account and factory premises could be sustained under Section 142 of the Customs Act, 1962 without first exhausting recovery by sale of the detained goods.

Analysis: The liability had already attained finality, and the detained photocopy machines had remained in customs custody for an extended period while the dispute over liability was being litigated. The delay in selling the machines was not treated as unreasonable in the peculiar facts, particularly since the machines had likely become obsolete and the recovery proceedings had been affected by repeated litigation and remands. The Court therefore held that the recovery officials had not acted wholly without jurisdiction by invoking the attachment mechanism under Section 142(1)(c)(ii), and substantial compliance with the recovery framework was sufficient on the facts.

Conclusion: The challenge to the attachment on the ground of non-exhaustion of the earlier recovery modes failed.

Issue (ii): Whether relief under Article 226 of the Constitution of India should be granted in view of the finality of the customs liability and the equities arising in the case.

Analysis: The Court treated writ jurisdiction as equitable and discretionary, and declined to interfere merely on a legal objection where the liability had attained finality and the petitioner could not dispute the dues. At the same time, the Court balanced the equities by taking into account the amount already recovered, the earlier payment, and the practical difficulty in selling obsolete goods. It accepted an undertaking to pay the balance amount, fixed the dues at a reduced sum as full and final settlement, and made continuance and quashing of the attachment dependent on compliance with that undertaking.

Conclusion: Limited conditional relief was granted in favour of the petitioner, with the attachment liable to be quashed on timely payment of the amount fixed by the Court.

Final Conclusion: The petition was disposed of by sustaining the attachment in the interim, but granting conditional relief that would result in quashing of the attachment upon payment of the balance amount within the stipulated time, while preserving the customs authorities' rights in case of default.

Ratio Decidendi: In recovery proceedings under the customs law, a writ court may refuse interference with attachment measures where the underlying liability has attained finality and the recovery process shows substantial compliance, while still moulding relief on equitable terms by imposing a conditional payment undertaking.

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