Bombay High Court Orders Re-testing Of Seized Goods To Support Trade Facilitation Policy Initiative

Bombay High Court Orders Re-testing Of Seized Goods To Support Trade Facilitation Policy Initiative

In a significant move reinforcing the government’s ‘Ease of Doing Business’ mandate, the High Court of Bombay recently issued a directive mandating the re-testing of seized goods. The bench, comprising M.S. Sonak, J and Advait M. Sethna, J, criticized customs officials for resisting a petitioner's request for re-testing, emphasizing that trade facilitation measures should not be arbitrarily denied.

The Dispute Over Seized Consignments

The petition was filed by Vyom Dipesh Raichanna against the Union of India, following the seizure of imported cashew nuts. The importer sought a re-test of the goods after an initial assessment by a laboratory in Kerala returned findings adverse to the petitioner. Crucially, the petitioner highlighted that a prior seizure of similar goods had yielded a favourable report from an accredited laboratory within Maharashtra.

The Customs Authorities argued that the request for re-testing was filed beyond the stipulated 10-day window and that the petitioner was improperly seeking the drawal of fresh samples rather than relying on existing remnants.

Legal Conflict and Administrative Guidelines

The petitioner relied on Public Notice No. 97 of 2017, which establishes guidelines for re-testing as a trade facilitation measure. Counsel for the petitioner argued that denial of this facility without compelling, recorded reasons runs contrary to the spirit of national trade policies. Conversely, the respondents maintained that their actions were consistent with standard departmental procedures and noted that adjudication proceedings were already underway following a show-cause notice issued on 3 July 2025.

The High Court, however, questioned the resistance offered by the authorities. It observed that the public notice guidelines were designed to ensure fairness, not to obstruct importers. The court further noted the inconsistency in referring the samples to a laboratory in Kerala when several specialized laboratories were available within Maharashtra.

Key Observations from the Court

The bench emphasized that government policies aiming to simplify trade must be reflected in the conduct of its departments:

• "The facility of re-testing is a trade facilitation measure, which, generally, will not be denied in the ordinary course."
• "The objective of such guidelines is to determine the correct status of the imported goods in a mutually fair manner. The object is not to trip on the importers or to make the determination of truth difficult."
• "It is the duty of all Departments of the Government of India to facilitate the policy of the Government of India about the ‘ease of doing business’."
• "If the seized goods match the description declared by the petitioner, there is no point in allowing this issue to linger."

Directives and Future Implications

Finding that the refusal to allow a re-test was unreasonable, the High Court directed that fresh samples be drawn in the presence of the petitioner’s representative within five days. These samples are to be forwarded to the Central Revenues Control Laboratory (CRCL) in New Delhi, a government-operated facility. The CRCL is expected to provide its report within one month, which will then guide the final adjudication of the show-cause notice.

By ruling in favor of the petitioner, the High Court has sent a clear signal that customs authorities must justify any departure from trade facilitation norms with specific, written reasons, rather than relying on bureaucratic obstacles. This decision serves as a reminder that the administrative process must remain transparent and equitable to support a fair business environment.