Denial of Opportunity to Challenge Gold and Diamond Jewellery Seizure Would Leave Passengers “Choked & Strangulated”: Gauhati HC [Read Order]

In a recent ruling, the Gauhati High Court disposed of a writ appeal filed by. and held that the appellant must be given an opportunity to challenge the seizure of gold and diamond jewellery in the confiscation proceedings.

The case started in 2017 when an employee of the appellant company (Manik Chand and Sons (Jewellers) Pvt. Ltd) was travelling from Guwahati to Kolkata carrying old gold and diamond-studded jewellery belonging to customers for repair and polishing work. The employee was intercepted at the Guwahati airport and the jewellery was seized by the Customs authorities on the ground that the documents produced did not fully match the requirements.

The appellant argued that the seizure was illegal as the jewellery consisted of old and used ornaments belonging to customers and there was no evidence to show that the items were imported goods. They also argued that the seizure was made beyond the customs area.

The appellant earlier challenged the seizure before the High Court, where an interim order was passed for release of the jewellery on furnishing security. The jewellery was released after furnishing security of Rs. 11,17,530 against a valuation of Rs. 44,70,121.

While the matter was pending, the Customs department issued a show cause notice dated 16.08.2018 proposing confiscation of the jewellery. This notice was challenged by the appellant on the grounds of limitation and jurisdiction, but the writ petition was dismissed and the appellant was directed to participate in the proceedings.

Later, the writ petition challenging the seizure was also dismissed by the Single Judge on the ground that once the challenge to the show cause notice had failed, the seizure itself need not be examined separately.

Aggrieved by this, the appellant filed the present writ appeal.

The Division Bench comprising Chief Justice Ashutosh Kumar and Justice Arun Dev Choudhury observed that the Single Judge had not examined the correctness of the seizure and had dismissed the case only because the challenge to the show cause notice had failed. The court explained that seizure and confiscation are different stages and the appellant should not be denied the opportunity to question the seizure.

The court observed that denying such opportunity would leave the appellant without any proper chance to defend and stated that “without permitting the appellant of doing that, we are of the view, the appellant would stand choked and strangulated without any opportunity to him to explain that the seizure was bad.”

The tribunal further observed that the appellant must be allowed to raise all grounds, including the legality of the seizure, while responding to the confiscation notice.

The court disposed of the appeal by permitting the appellant to question the correctness of the seizure in the confiscation proceedings and directed that reasonable opportunity should be given to present its case.

It also observed that if any request for extension of time is made by the appellant, the authorities are expected to grant the same.

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