Provisional Release of Goods Under Section A of the Customs Act: Madras HC Grants Importer an Opportunity for Hearing

The Madras High Court has granted an importer an opportunity to be heard in relation with his plea for provisional release of imported goods that had been detained by customs authorities.

The petitioner, Mr. Satheesh T R, Proprietor of M/s. Adhyas Nutrition and Feed had initially challenged a show cause notice dated 07.10.2024, issued by the Additional Commissioner of Customs, Chennai, on grounds that the goods in question covered under Bills of Entry dated 26.06.2024 were compliant with Indian standards and eligible for provisional release.

At the same time, the petitioner requested a directive to issue certificates of detention and demurrage waiver. According to the petitioner, this new test report confirmed that the imported goods met Indian quality standards.

The counsel for the department submitted that earlier test report has given detailed analysis as to why the goods in question are not as per the Indian Standards. However, the counsel for the petitioner, Adv. Hari Radhakrishnan drew the attention of this Court to the subsequent test report and submitted that goods in question can be released provisionally under Section 110A of the Act.

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The standing counsel for the respondents, Adv. S.R. Sundar also submitted that as seen from the subsequent test report, which is relied upon by the counsel for the petitioner, it gives only the nutritional value of the subject goods.

Justice Abdul Quddhose noted that the issue is highly debatable and held that the petitioner should be allowed to submit a reply including this new evidence and that the customs authorities must consider this reply in a fair and timely manner.

The bench ordered that the petitioner submit a reply to the show cause notice within one week. Subsequently, the Additional Commissioner of Customs is required to pass a final order within three weeks, post-hearing.

In addition, it was directed that if the decision is favorable to the petitioner, the court granted him the liberty to file a fresh representation for provisional release of the goods under Section 110A, which allows conditional release of goods pending adjudication.

The court also directed the customs authorities to consider issuance of a detention and demurrage waiver certificate, subject to the outcome of the proceedings.

Conversely, if the goods are ultimately deemed to be prohibited items, the petitioner will not be eligible for provisional release, added the court.

The court also clarified that it had not expressed any opinion on the merits of the competing claims and directed both parties to proceed strictly in accordance with law.

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