Customs Authorities Criticized for Misuse of Power in Unsubstantiated Seizure Case
In a significant judgment delivered by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) at the Kolkata Eastern Zonal Bench, the tribunal has set aside the seizure of goods by the customs authorities, castigating them for misuse of power and lack of evidence in a case concerning the alleged illegal export of goods to Nepal.
The case, "Shri Anil Kumar v. Commissioner of Customs (Prev.), Patna," involved the seizure of 212 bundles of clothes from two trucks en route to Sunali on September 1, 2016. The customs authorities presumed the goods were meant for illegal export to Nepal, despite the location being over 200 km from the border. The appellant, Shri Anil Kumar, provided valid invoices and Suvidha forms to substantiate the legitimate procurement of the goods, which were found to be of Indian origin.
The tribunal, presided over by Shri Rajeev Tandon, Member (Technical), held that the seizure was invalid due to the absence of corroborative evidence and the goods not being found in a notified customs area as required by Sections 7, 8, and 110 of the Customs Act, 1962. The judgment emphasized that mere presumption or solitary statements without evidence cannot justify the seizure of goods.
During the proceedings, the Revenue's representative argued that the appellant did not possess an IEC code necessary for export, supporting the seizure. However, the tribunal ruled that non-possession of an IEC code is not a valid ground for seizure when the goods are of Indian origin and no evidence of cross-border movement exists.
The tribunal criticized the customs authorities for relying solely on statements from truck drivers without any substantive evidence, highlighting the misuse of powers and the harassment caused to legitimate trade. It underscored that the onus under Section 110 of the Customs Act was not discharged, rendering the seizure illegal.
The judgment concluded by setting aside the impugned order and directing consequential relief to the appellant. The tribunal strongly condemned the coercive actions of the department, urging them to prevent recurrence of such harassment to the trade.
This ruling serves as a stern reminder to customs authorities about the importance of adhering to statutory provisions and ensuring evidence-based actions, especially in matters involving severe implications for trade and commerce.
Bottom Line:
Customs Act - Goods of Indian origin seized on the presumption of being meant for illegal export - Held, seizure invalid in absence of corroborative evidence and violation of statutory provisions under Section 110 of the Customs Act - Authorities castigated for misuse of power.
Statutory provision(s): Customs Act, 1962 Sections 7, 8, 110
