Second CRCL Report Prepared without Drawing Fresh Samples of Exported Products: Delhi HC Questions Customs [Read Order]

In a recent ruling, the Delhi High Court questioned the Customs Department for relying on a second CRCL report that was prepared without drawing any fresh samples of the exported products, and directed Customs to take a reasoned decision on the exporter’s request for release of bank guarantees.

Truespices India Inc., the petitioner, filed a writ petition before the Delhi High Court seeking finalisation of its shipping bills and release of bank guarantees furnished at the time of provisional clearance of its export consignments. The petitioner is engaged in the export of tobacco-related products such as pan masala and mouth fresheners and holds valid GST registration, Tobacco Board registration, and an FSSAI licence.

The petitioner had filed shipping bills dated 28 October 2024 for export of goods described as mouth fresheners, pan masala RG, and tobacco T. Although the goods were exported, an alert was raised by the Customs Department, and the consignments were released only on a provisional basis after the petitioner furnished bank guarantees and bonds.

Samples of the exported goods were sent to the Central Revenues Control Laboratory. CRCL issued test reports dated 24 December 2024 and 27 December 2024. These first CRCL reports recorded the composition of the products and did not raise any objection. Based on these reports, the petitioner requested finalisation of the shipping bills and release of the bank guarantees.

However, without drawing any fresh physical samples of the exported goods, a second CRCL report dated 10 November 2025 was issued as a clarification. In this report, the products were stated to have the characteristics of Gutka. Relying on this second report, the Commissioner of Customs issued a letter dated 5 February 2025 to the GST Department requesting that the petitioner’s IGST refund should not be processed.

The petitioner’s counsel argued that the first CRCL reports were binding and that the second CRCL report was untenable, as no fresh samples were drawn and no reasons were given for changing the findings. They also argued that repeated representations seeking release of bank guarantees were not decided and that no show cause notice had been issued.

The respondents’ counsel relied on the second CRCL report and defended the provisional actions taken by Customs, including retention of bank guarantees and the communication sent to the GST Department.

The Division Bench comprising Justice Prathiba M. Singh and Justice Shail Jain observed that the circumstances under which the second CRCL report was issued were unclear. The court observed that the report did not explain why a clarification was required or how a different conclusion was reached without drawing fresh samples.

The court explained that the petitioner’s representations for the release of bank guarantees had not been decided and that the matter required holistic consideration by the Commissioner of Customs.

The court also observed that no show-cause notice had been issued to the petitioner. The Bench pointed out that if Customs intended to issue a show cause notice, it should be done expeditiously so that the petitioner’s future exports are not unnecessarily affected.

The court disposed of the writ petition without examining the merits of the dispute. The court directed the Commissioner of Customs to decide the petitioner’s representations for release of bank guarantees by 28 February 2026 and to issue any show cause notice by 10 January 2026, if proposed, along with deciding the representations. All rights and contentions of the parties were left open.

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