Conflicting Lab Reports of Classification of Roasted Areca Nuts: Madras HC Orders Provisional Release, Directs to Execute Bond for Differential Duty [Read Order]
The bench directed the Customs authorities to consider and decide any request made by the petitioner for waiver of demurrage charges. After fulfillment of these conditions, the authorities were ordered to release the goods within 48 hours
The Madurai Bench of the Madras High Court has ordered the provisional release of a consignment of roasted areca nuts imported amid conflicting laboratory reports on its proper classification under the Customs Tariff.
The petitioner, M/s. Genuine Spices had imported the consignment through Bill of Entry dated 28.06.2024, but clearance was withheld by Customs on the ground that the goods were misdeclared and did not qualify as roasted areca nuts.
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While the ABC Techno Labs, Chennai, supported the petitioner’s claim and led to a No Objection Certificate (NOC) from FSSAI, the Central Revenue Control Laboratory (CRCL), Delhi concluded otherwise, stating that the goods could not be classified as roasted areca nuts.
The Court observed that retaining the consignment indefinitely would not serve the ends of justice as it is perishable in nature. Accordingly, Justice G.R. Swaminathan directed Customs to provisionally release the goods subject to conditions.
The Court laid down specific conditions for the provisional release of the consignment. The petitioner was directed to pay all applicable taxes and duties on the imported goods and execute a personal bond for the differential duty, considering the possibility of classification under CTH 080280 (areca nuts) instead of CTH 20081920 (roasted areca nuts).
In addition, the petitioner must submit all requisite certificates, including the mandatory phytosanitary certificate.
The bench also directed the Customs authorities to consider and decide any request made by the petitioner for waiver of demurrage charges. After fulfillment of these conditions, the authorities were ordered to release the goods within 48 hours.
The Court also clarified that this order of provisional release does not preclude Customs from adjudicating the classification dispute under the Customs Act, nor can the petitioner later argue that penalty is barred due to the release. The petitioner also undertook to cooperate fully in adjudication proceedings.
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