K. Vinod Chandran, CJ.—The petitioners in the above writ application are aggrieved with the seizure of goods and the adjudication order passed, bearing No. 64-Cus/JC/Denovo/FBG/2014 dated 13.03.2015, produced at Annexure-11.

2. Learned counsel for the petitioners pointed out that the reason for seizure or detention was not the ground on which the adjudication proceedings were initiated; which vitiates the seizure. Section 100 of the Customs Act, 1962 requires ‘reasons to believe’ for making seizure of goods. In the present case, the seizure was made purportedly for violation of provisions of Notification No. 9/96 (N.T)-Cus dated 22.01.1996, issued under Section 11 of the Customs Act. The notification was with respect to import of goods into India from Nepal; goods which have been imported into Nepal from other countries. However, the show-cause notice and the adjudication order proceeded on the basis that there was illegal export attempted by the petitioners. The goods seized was sugar which has not been notified under Section 11 of the Act. Further, the petitioners had specifically sought for cross-examination of the officer who made the seizure, which request though recorded in the adjudication order, was not permitted.

3. Reliance was placed on Chairman-cum-Managing Director, Coal India Limited and others vs. Ananta Saha and others; (2011) 5 SCC 142 to contend that when the foundation itself is removed, i.e. the seizure is vitiated, the superstructure falls. If the ‘reason to believe’ is found to be not valid then necessarily there can be no valid seizure or further adjudication on the basis of the invalid seizure. Andaman Timber Industries vs. Commissioner of Central Excise, Kolkata-II; (2016) 15 SCC 785 was relied on to emphasize that the right to cross-examine a witness before the adjudicating authority is fundamental to the principles of natural justice.

4. Learned Standing Counsel for the Department, from the counter affidavit filed, pointed out that earlier the petitioners had approached this Court and they were relegated to the statutory authority. There is a statutory remedy of appeal available to the petitioners, which the petitioners have not chosen to avail. It is also submitted that as per the export policy, sugar can be exported by a merchant, importer/exporter only after obtaining an export release order from Chief Director (Sugar) i.e. through export licensing.

5. The seizure receipt, as produced at Annexure P/1, in the column for ‘reasons for seizure or detention’ indicates violation of provisions of Notification No. 9/96 (NT) Cus dated 22.01.1996. The said notification relates to the following:—

“Goods which have been exported to Nepal from countries other than India except machinery and equipment used in Nepal for the execution of a project may be allowed to be imported into India from Nepal after completion of the project subject to the conditions specified in Notification No. 9/96-Cus., dated 22-1- 1996.”

6. Obviously, the specific notification is with respect to import into India of goods or products which have been first imported into Nepal. The show-cause notice issued is produced at Annexure-3. Contrary to the reason indicated for seizure, the show-cause notice is for illegal export in violation of the provisions of the Customs Act read with Section 3 of the Foreign Trade (Development and Regulation) Act, 1992 and notification issued thereunder. The final adjudication order is also based on the finding of an illegal export.

7. ‘Reason to believe’, as declared in Sheo Nath Singh vs. Appellate Assistant Commissioner of Income Tax, Calcutta; (1972) 3 SCC 234, suggest a belief which is honest and one which a reasonable person arrives at based upon reasonable grounds. It cannot be a mere suspicion or gossip or rumour. We specifically extract Paragraph 10 of the decision hereunder:—

“10. In our judgment, the law laid down by this Court in the above case is fully applicable to the facts of the present case. There c