ORDER

1. This writ petition under Article 226 of the Constitution challenges the action of the Respondent Directorate Revenue Intelligence („DRI) in continuing to keep the bank accounts of the Petitioner frozen.

2. According to the Respondents, as stated in their counter affidavit in the present case, on the evening of 7th September 2005 certain consignments of imported duty free high value computer parts imported in the name of M/s. Everest Exports were taken delivery of at the Air Cargo complex, IGI Airport, New Delhi. They are alleged to have been taken to the residence of Shri Bhuvan Aggarwal the proprietor of the Petitioner M/s. Laxman Overseas, the petitioner herein, and unloaded there. During a subsequent search of the Petitioners premises the imported goods were found to be high value computer parts. Their present market value was estimated at Rs.1.80 crores whereas the description of the goods declared in the Bill of Entry was “mounted PCB for digital data recorder” and their value was declared as Rs.6,76,060 (C.I.F. value). It is alleged that during the search of the petitioners premises a few days later, PCBs of inferior quality/junk old PCBs were apparently stored for being to the factory premises at Noida for substitution in place of duty free imported goods in future. A reference is made in the counter affidavit to certain other transactions involving the Petitioner which led to the conclusion that the Petitioner was exporting junk material by declaring it as “mounted PCBs for telecommunication, plastic grating and sewing needles.”

3. In relation the petitioners bank accounts which were frozen, it is stated in para 9(d) of the counter affidavit as under:

“The money lying in the EEFC Account No. 3004042934 are sale proceeds of goods exported by the present Petitioner. The investigation conducted so far including interception of live export consignments revealed that the present Petitioner was indulging export of junk goods declaring the same as high value goods. Therefore, the bank accounts of the Petitioner and its proprietor are subject to seizure under Section 110(3) of the Customs Act, 1962 and the money lying in those accounts is liable for confiscation under Section 121 ibid. Further, the provisions of Section 110 (2) of the Customs Act, 1962 which lay down that in case of seizure of goods as per provisions of Section 110(1) of the Act ibid, in case no notice is given under Section 124 of the Act ibid, then the goods shall be returned to the persons from whom they were seized. In this case, however, the bank accounts have been frozen in terms of Section 110(3) of the Act ibid, to which the limitation laid down under Section 110(2) is not applicable [Judgment of Honble High Court of Calcutta in case of Rohit Kumar v. Union of India, as discussed above refers].”

4. Further in para 10 of the counter affidavit it is stated as under: “Thus it is observed that there is a proclivity on part of the accused to not only evade duties, but also to dishonor the legal processes that have been initiated by the Government, such as, summons etc. In these circumstances, without prejudice to our argument above, there is a strong likelihood of the accused withdrawing the money in these bank accounts, which is otherwise liable for confiscation being sale proceeds of smuggling. Therefore, on this count too, the accounts should continue to remain frozen.”

5. As can be noticed from the above averments the Respondents refer to Section 110 (3) of the Customs Act, 1962 („Act?) to justify the freezing of the petitioners bank accounts. In addition, learned counsel for the Respondents relies upon Section 121 of the Act to justify the continued freezing of the petitioners bank accounts.

6. Learned counsel for the Petitioner points out that the sole proprietor of the Petitioner concern, Shri Vipul Aggarwal, was placed under preventive detention by an order dated 3rd January 2006 under the Conservation of For

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