TaxTMI 
TaxTMI 
2026 (8) TMI 1013
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....ill physical relates. 2. Brief Facts in W.P.No. 45195 of 2025: 2.1. The Petitioner filed Bill of Entry No. 9415764 dated 10.04.2025, declaring the goods as "Betel Nut Product (Unflavoured Supari)" under CTH 2106 90 30 and claiming Free Trade Agreement (FTA) benefit. On 11.04.2025, a query was raised in ICES, as to why the goods should not be classified under CTH 0802, and the Bill of Entry was flagged for misclassification risk. With a view to ensuring proper scrutiny of the dispute so raised, the Bill of Entry was transferred from the Faceless Assessment Group (FAG) to the Port Assessment Group (PAG), and placed before the local group for detailed examination of the cargo and connected documents. 2.2. Upon due approval obtained through the e-office system, First Check Examination was ordered. In the meantime, on 06.05.2025, Petitioner was permitted storage at CFS under Section 49 of the Customs Act, 1962 to avoid demurrage. Having regard to the nature of the goods, the Docks Intelligence Unit (DIU), Chennai III (Preventive), by letter dated 14.05.2025, directed detailed examination and inspection by the Plant Quarantine (PQ) authorities, in accordance with the guidelines ....
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....nior Advocate Mr. Vijay Narayanan appearing for the Petitioner would submit that Respondents' attempt to reclassify "Betel Nut Product (Unflavoured Supari)" from CTH 2106 90 30 to either CTH 0802 or CTH 2008 is contrary to the Chapter Notes Appended to Chapters 8, 20 & 21, and denying the Petitioner the benefit of the DFTP scheme and the proposed classification is contrary to Advance Ruling in favour of petitioner. Further, the goods pertaining to Bill of Entry No. 9415764 dated 10.04.2025 and Bill of Entry No. 3886188 dated 14.08.2025 were not released for home consumption, and nor was any "Detention memo" or "Seizure memo" issued to the importers. It was further submitted that the time period prescribed, or the extension thereof, in terms of Section 110 of the Customs Act, 1962 has not been followed, and no extension of time of time limit prescribed in the said Section in writing has been granted by an authority competent, thus goods ought to be released unconditionally to the petitioner. 4.2. Learned Senior Counsel would further submit that the Respondents' claim that the goods were "never detained," yet they have physically held the cargo since August 2025 in W.P. No....
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....ty as such, notwithstanding the limited processes undertaken for preservation or marketability, and that Chapter 8 expressly covers edible nuts including areca nut, constituting the most specific entry, whereas Chapter 21 operates only as a residual category for "preparations." By classifying the goods under Chapter 21 instead of the correct classification under Chapter 8, the petitioner have claimed exemption under Notification No. 50/2017-Cus. which is not applicable, resulting in a differential duty of Rs. 12,49,96,034/- liable to be recovered. It is submitted that there is no delay attributable to the Respondent in the assessment proceedings; the delay has been caused solely due to the petitioner failure to participate in the assessment process under Section 17, despite being given an opportunity through an electronic query, and that in view of the magnitude of duty involved and misclassification by the petitioner, it is necessary to insist upon a bank guarantee along with bond for provisional release, in order to adequately protect the interest of the Department. 6. In view of the above background, the short question that arises for consideration is whether it is permissibl....
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....ption. This process for clearance of goods may take some time but certainly the goods cannot be detained for an indefinite period in the name of verification. This aspect was dealt with by the Punjab and Haryana High Court which will be adverted to a little later. ..... 30. Delhi High Court in Sai Incorporation Vs. Principal Commissioner for Customs (Import) reported in 2016 (338) E.L.T. 578 held that failure of the customs authorities to release the goods notwithstanding expiry of the time limit under section 110(2) of the Customs Act is unlawful. Accordingly, direction was issued for immediate release of the seized goods unconditionally without precluding the customs department from proceeding to take any further action as permissible in law including proceeding under section 124 of the Customs Act. 31. Upshot of the above discussion is that firstly, there is no provision in the Customs Act authorizing detention of goods. Secondly, even if the understanding of the customs department as discussed in Ramnarain Bishwanath (supra) is accepted, then also detention would be at a stage after seizure. Detention and seizure therefore cannot be used interchangeab....