Decision by Customs Dept that Goods should not be granted clearance in absence of conform, to opinion by CAAR is unsustainable: Bombay HC [Read Order]

The Bombay High Court observed that decision by the Customs Department that goods should not be granted clearance in absence of conform, to opinion by the Customs Authority for Advance Ruling ( CAAR ) is unsustainable.

The case of the Petitioner is that she is involved in the business of trading in such goods. Before the import of the goods, the Petitioner had approached the Customs Authority for Advance Ruling, Mumbai ( “CAAR” ) seeking classification of such goods in terms of Section 28H of the Customs Act, 1962.

The CAAR rendered its ruling dated 24th February 2023 wherein the classification of the goods in question was confirmed to be falling under CTH 21069030. Pursuant thereto, the Petitioner, imported a consignment of the said goods from one M/s. Mano Agro Company Limited, Cambodia.

The petitioner attempted to take further steps to clear the goods, namely, at the request of the petitioner, respondent No.3 approached the Director, Food Safety and Standards Authority of India ( FSSAI ) for verification / testing of the impugned goods inter alia on the ground that the Petitioner had given vague description suggesting that some processes were conducted on the impugned goods which could not be ascertained with the naked eye and, therefore, the nature of the mix created in the impugned goods would require verification from the FSSAI.

It is thus clear that the FSSAI, following the statutory mandate under the said Regulations, had no objection to the goods being cleared for home consumption. The Respondents, however, were not satisfied, and over and above the FSSAI opining that the goods conform to the edible standards, as laid down under the said regulations, respondent no.3 obtained a further analysis of the goods from the DYCC.

A Division Bench of Justices Firdosh P Pooniwalla and GS Kulkarni observed that “Thus, we do not find that there is any objectionable or any fatal impurity which would render the goods to be labelled as prohibitory. In our opinion, the respondents ought not to have taken such a decision that the goods should not be granted a clearance and/or a situation is brought about that they do not conform, to the opinion as rendered by the CAAR. In our view, in the facts of the present case, accepting such stand, as taken on behalf of the respondents would certainly render nugatory, the ruling of the CAAR, as also the report of the FSSAI and the DYCC. Such stand of the department thus, cannot be sustained.”

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