Administrative Circulars and Reasonable Classification can lawfully channel e auctions via a PSU if temporally limited and non arbitrary.

Addresses validity of a Central Board circular canalising e auctions of unclaimed/uncleared imported goods through a single agency for a limited period. Concludes the measure is an administrative exercise of the Board's power to prescribe separate procedures, permissible under constitutional review so long as classification is reasonable and non arbitrary; courts should not substitute policy judgment. Finds the temporal limitation, segregation of disputed consignments, retention of prior procedure for unsold goods, and reliance on operational reports provide a rational nexus to public interest objectives of expeditious clearance and revenue protection, so the circular does not infringe equality or unduly restrict commercial freedom.

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Issues: Whether the Circular dated 3 December 2018 issued by the Central Board of Indirect Taxes and Customs, which canalizes e-auctions of unclaimed/uncleared imported goods through a single agency (MSTC) for a limited period, is ultra vires the powers of the Board under Section 143-AA of the Customs Act, 1962 and/or violative of Articles 14 and 19(1)(g) of the Constitution of India.

Analysis: The Circular is an executive administrative measure addressing disposal of unclaimed/uncleared cargo and was issued under the power to prescribe separate procedures for categories of goods or persons in Section 143-AA of the Customs Act, 1962. Judicial scrutiny of economic or fiscal policy measures is limited to legality, arbitrariness, procedural fairness and compliance with constitutional limits; courts exercise restraint and do not substitute policy judgment. Reasonable classification and an intelligible differentia connecting the classification to the objective are constitutionally permissible. Administrative circulars need not contain detailed reasons; where challenged the issuing authority may place reasons on record (e.g., in counter-affidavit) and courts may examine whether those reasons demonstrate absence of arbitrariness. The impugned Circular aims at expeditious, transparent disposal of cargo through a centralized e-auction portal run by a PSU with demonstrated capacity, for a limited period (one year after unloading), and contains safeguards such as segregation of disputed consignments and preservation of prior disposal procedure for goods remaining unsold after one year. The measure engages Article 19(1)(g) but is subject to reasonable restriction under Article 19(2); the limited temporal scope and stated public interest objectives constitute a rational nexus to the aim of expeditious clearance and revenue protection. Reliance on earlier task force reports, operational limitations of field formations, and the PSU's auction infrastructure were adequate factual bases for the policy choice; no misuse of the statutory power is established.

Conclusion: The Circular dated 3 December 2018 is within the scope of Section 143-AA of the Customs Act, 1962, does not offend Article 14, and constitutes a reasonable restriction on the freedom under Article 19(1)(g); consequently the challenge to the Circular fails and the impugned judgment dismissing the writ petition is upheld.

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