Provisional release of seized imports cannot be made subject to an unreasonable bank guarantee based only on visual inspection.

A bank guarantee condition for provisional release of seized imported goods was found arbitrary and unreasonable because it was imposed mainly on the basis of a CRCL visual inspection report, even though the National Food Laboratory had reported the goods fit for human consumption. The material showed that classification could not be determined by visual inspection alone and had to be assessed under the General Rules for Interpretation, section notes, chapter notes and relevant HSN guidance. The department also had not followed the FSSAI procedure consistently. The condition was therefore treated as disproportionate to the purpose of securing revenue and was set aside, permitting provisional release without that requirement.

---

---

Issues: Whether the condition requiring furnishing of a bank guarantee for provisional release of the seized imported goods was arbitrary, unreasonable and unsustainable in law.

Analysis: The goods were seized on the basis of a CRCL report that treated the samples as roasted areca nuts and unfit for human consumption, while the National Food Laboratory reported the goods fit for human consumption. The impugned condition rested mainly on the CRCL report, although that report was based on visual inspection and the Chemical Examiner was not a food analyst. Classification of goods cannot be determined by visual inspection alone, and the proper test must be applied with reference to the General Rules for Interpretation, section notes, chapter notes and the relevant HSN guidance. The material also showed that the Department had not followed the FSSAI procedure consistently, and the bank guarantee condition was imposed in a manner that was disproportionate to the purpose of safeguarding revenue.

Conclusion: The condition requiring furnishing of a bank guarantee was held to be arbitrary and unreasonable and was set aside; provisional release was directed without that requirement.

Ratio Decidendi: A condition for provisional release of seized goods must be reasonable and proportionate to the object of securing revenue, and a classification or fitness decision based only on visual inspection by a non-food analyst cannot justify an onerous bank guarantee requirement.

---