Madras HC Flags Decade‑Long Delay in Customs Assessment: Directs Finalisation of TVS Motor Imports Within Six Weeks [Read Order]

The Madras High Court has noted an inordinate delay of 10 years in the assessment of imports made by TVS Motor Company Ltd., directing the authorities to complete the process within six weeks by the customs department. The court also restrained the authorities from encashing the bank guarantees until the outcome of the assessment.

The issue emerged from the imports of aluminium alloy ingots covered under 32 bills of entry dating back to 2014. The TVS Motor, the petitioner, was granted provisional release of the goods under section 110A of the Customs Act, subject to furnishing a bank guarantee. Even after the passage of over 10 years, the customs department failed to pass the final assessment orders, which led to the company’s prolonged uncertainty.

The petitioner argued that the delay was arbitrary, illegal and was in violation of principles of natural justice. It was further argued that one bank guarantee was encashed in 2022 without any prior notice. This raised fear that the remaining guarantees could also be invoked despite no fina;l determination of liability. The company maintained that such action deprived it of the right to appeal and other legal remedies, while also exposing it to unwarranted financial burden.

The respondents in their counter-affidavit did not provide any explanation for the delay but agreed to remand for fresh consideration. They assured the court that the final assessment orders will be passed in accordance to the principles of natural justice.

JusticeAbdul Quddhose delivered a common order on multiple writ petitions filed by TVSMotor. It was noted that the Customs Department had failed to justify the delay. The Court observed that although provisional release was granted in 2014, the authorities had neither finalised the assessment nor explained their inaction.

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The Court observed that such a long delay would defeat the fairness of the process and could make any later levy of duty or penalty arbitrary.

In accordance with this, the Court directed the Deputy Commissioner of Customs to pass final assessment orders within six weeks. It was ruled to consider all contentions raised by the petitioner, including the issue of delay.

Importantly, the Court restrained the Customs Department from encashing any remaining bank guarantees until the assessment outcome is determined. It further clarified that the authorities cannot demand fresh documentation from the petitioner, and must rely only on the records already submitted at the time of provisional release.

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