2025 (10) TMI 1164 - HC - Customs

Order upholds absolute confiscation of seized jewellery, levies penalty, declares passenger ineligible and halves warehouse charges

Rohit Arora Versus Commissioner of Customs.

HC upheld absolute confiscation of the seized jewellery and levy of penalty, declaring the appellant an ineligible passenger and denying free allowance. ... Absolute confiscation of the seized jewellery along with levy of penalty - Petitioner was declared as an ineligible passenger - denial of free allowance - HELD THAT:- In any case, more than three months have already elapsed since the passing of the Order-in-Appeal. In view of thereof, there is no impediment in implementing the said order. Accordingly, the Order-in-Appeal dated 15th July, 2025 shall be given effect to within two weeks - In the facts of this case, warehouse charges shall be collected on the basis of rates applicable on date of detention, and the same is reduced to 50%. The Petitioner shall appear before the Authority on 3rd November, 2025 - Petition disposed off. ISSUES PRESENTED AND CONSIDERED 1. Whether the Appellate Authority's Order allowing release of detained jewellery on payment of redemption fine and reduction of penalty should be given effect to by the Customs authority. 2. Whether any impediment exists to execution of the Order-in-Appeal where more than three months have elapsed since its pronouncement and the Respondent is unable to state whether it has been challenged. 3. What consequences as to warehouse charges, timelines for compliance, and facilitation by a nodal official should be directed in implementing the Order-in-Appeal. ISSUE-WISE DETAILED ANALYSIS Issue 1: Authority to execute Appellate Order permitting release of detained goods on payment of redemption fine and reduction of penalty Legal framework: The Court considered the supervisory jurisdiction under Article 226 of the Constitution to direct implementation of an order passed by an Appellate Authority under the Customs Act. The operative statutory provisions engaged in the underlying administrative orders include Sections 111 (grounds for detention/seizure), 112 (penalty), and 125 (redemption fine) of the Customs Act, and the Baggage Rules/Notification governing passenger allowance and ineligibility. Precedent Treatment: No specific judicial precedents were relied upon or cited by the Court in the oral judgment; the decision rests on application of the statutory scheme and the finality/effect of an Appellate Authority's order. Interpretation and reasoning: The Court noted that the Appellate Authority had 'allowed the appeal partially' and ordered release of the impugned goods on payment of a redemption fine under Section 125 along with applicable customs duty, and had reduced the penalty under Section 112. The Court treated that order as an operative mandate that may be implemented by the Customs authority. The Court observed that more than three months had elapsed since the Appellate Authority's order and that the Respondent had no clear instruction as to any challenge, thereby implying no continuing interlocutory restraint against execution. Ratio vs. Obiter: Ratio - The Court's directive that an Appellate Authority's order for release on payment of redemption fine and reduction of penalty must be given effect to when no legal impediment is shown. Obiter - Observations regarding the background facts (interception, quantification of goods) are descriptive and not central to the legal holding. Conclusions: The Court directed that the Appellate Authority's Order be implemented within two weeks, thereby mandating release subject to payment of redemption fine and duties as ordered on appeal. Issue 2: Effect of passage of time and absence of clarity as to challenge on the Respondent's ability to resist execution Legal framework: The Court applied principles governing execution of final administrative/appeal orders and the supervisory jurisdiction to enforce compliance with such orders in the absence of stay or appeal proceedings that would restrain implementation. Precedent Treatment: No prior authorities were cited; the Court's approach was pragmatic - assessing whether any statutory or interlocutory barrier persisted. Interpretation and reasoning: The Court reasoned that where an Appellate Authority has passed an order and the custodian/respondent does not demonstrate any subsisting stay, challenge, or other legal bar, the order should be implemented. The elapse of more than three months since pronouncement of the Appellate Order without showing of a restraint was treated as a relevant circumstance favouring immediate execution. Ratio vs. Obiter: Ratio - The finding that passage of time and lack of demonstrated challenge/no-stay justify giving effect to the Appellate Order. Obiter - Reference to the Respondent's counsel lacking instructions is incidental. Conclusions: No impediment was found; the Court ordered implementation of the Appellate Authority's directions within a stipulated time-frame. Issue 3: Determination of warehouse charges and directions for facilitation and compliance Legal framework: The Court exercised equitable and supervisory power to direct manner of computation/levy of incidental charges (warehouse charges) and to reduce such charges where appropriate in the facts of the case, consistent with ensuring compliance with the Appellate Order. Precedent Treatment: The judgment does not rely on specific authorities; the reduction of warehouse charges is an exercise of the Court's discretion in execution of relief. Interpretation and reasoning: Recognising the financial impact of continued detention and in consideration of the facts (quantum of goods and delay), the Court directed warehouse charges to be collected on the basis of the rates applicable on the date of detention but reduced to 50% of that amount. The Court additionally set a concrete compliance timetable (appearance date) and required facilitation by a nominated nodal officer to enable the Petitioner's appearance before the competent authority for compliance. Ratio vs. Obiter: Ratio - The direction to apply detention-date rates for warehouse charges and to reduce those charges to 50% as part of implementation of the Appellate Order. Obiter - The specific account details/administrative contact information supplied in the order are administrative facilitation rather than legal principle. Conclusions: Warehouse charges to be computed at rates prevailing on date of detention and payable at 50% thereof; the Petitioner directed to appear on the specified date for compliance; the competent authority to be facilitated by a nominated nodal officer for execution of the Appellate Order. Ancillary and Procedural Observations Legal framework: The Court invoked its constitutional supervisory jurisdiction to ensure execution of administrative appellate decisions and to manage incidental reliefs (costs, charges, facilitation timelines). Interpretation and reasoning: The Court recorded that the OIO had declared the passenger ineligible and ordered confiscation and penalty; the Appellate Authority modified that outcome. The Court declined to stay or re-examine the merits of the Appellate Order, limiting its role to enforcing the appellate mandate and providing incidental directions to effectuate release. Ratio vs. Obiter: Ratio - The Court will enforce an Appellate Authority's order absent demonstration of a legal impediment; it may also modulate incidental financial consequences (e.g., warehouse charges) to secure equitable implementation. Obiter - Detailed factual recitation of investigative/appraisal steps underpinning the administrative orders. Conclusions: Implementation ordered within two weeks; incidental reliefs and facilitation measures were directed to effectuate the Appellate Authority's decision. The petition was disposed of accordingly, with pending applications dismissed as consequential.