Confiscation of goods without notice to the owner is illegal under the Customs Act, 1962.

Ruma Pal, J.

1. THIS writ application was moved in September 1987. Directions for filing of affidavits was given on 14th September 1987. No. affidavit-in-opposition has been filed by the respondents. I, therefore, proceed on the basis that the facts as stated in the writ petition are admitted.

The facts are as follow –

The petitioner carries on business in Singapore. The petitioner manufactures and deals in Video Magnetic Tapes, components of video cassettes etc. In 1985 an agreement was entered into between M/s. Chinar Electronics and the petitioner under which the petitioner agreed to sell and deliver video magnetic pancakes and video cassettes without spools (hereinafter referred to as the said goods) to one M/s. Chinar Electronics. Payment for the said goods was to be made by negotiation through the bank of M/s. Chinar Electronics i.e., VYSYA Bank.

2. PURSUANT to the agreement, the petitioner shipped the said goods to Calcutta. The documents of title were forwarded by the petitioner to the bankers of M/s. Chinar Electronics for retirement. The documents were returned to the petitioner by Vysya Bank under cover of a letter dated 9/9/1985 on the ground that M/s. Chinar Electronics had failed to retire the same. Correspondence ensued between the petitioner and M/s. Chinar Electronics which culminated in M/s. Chinar Electronics requesting the petitioner to take back the goods as they were unable to pay for the same. The correspondence ended in September 1985. The petitioner wrote several letters to Clearing Agents in Calcutta as well as to the Shipping Company which brought the said goods to re-ship the said goods back to Singapore. The petitioner was informed by the Shipping Company that the goods had been detained by the Customs Authority and could not be reshipped. In fact the Customs Authorities seized the said goods in October 1985. The petitioner was advised by the High Commissioner, Singapore to place his case before the Collector of Customs. This the petitioner did by letters dated 28/10/1985, 26/11/1985 and 5/5/1986. No reply having been received by the petitioner from the Collector of Customs, the petitioner again contacted the Indian High Commissioner at Singapore where apparently the petitioner was advised that no step would be taken by the Customs Authorities with regard to the goods without hearing the petitioner.

In June 1987 the petitioner came to learn that by an order dated 19-8-1986 bearing No. 32/86 (Prev.) the respondent No. 1 herein had confiscated the goods under Section 111(d) of the Customs Act, 1962 (hereinafter referred to as the Act). This order has been challenged by the petitioner. The principal ground of challenge is that the order of confiscation could not have been passed without notice to the petitioner. The petitioner has relied upon Section 124 of the Act to contend that the order of confiscation could not have been passed without giving the petitioner who was the owner of the goods, notice in writing.

3. THE petitioner has also relied upon a decision of the Bombay High Court in the case of Sampat Raj Dugar v. Collector of Customs, New Custom House, Bombay and Ors. reported in 1988 (15) ECR 338. The facts in that case are substantially similar to the facts in this case. The Bombay High Court quashed the order of confiscation and directed re-shipment of the goods to the owner. In this case the petitioner merely prays for an opportunity to be heard by the Collector of Customs.

4. IT is contended on behalf of the Customs Authorities that -

(1) Even if the petitioner is the owner of the goods, it does not entitle it to return of the goods once the order of confiscation was passed even though the order of confiscation may have been passed without notice to the petitioner.

(2) The petitioner was only entitled to a hearing if any fine or penalty was imposed against it under Section 112 of the Act.

(3) The Bombay case had no application as the goods had been authorisedly imported in that case