Simplified Explanation of the Judgment
In a significant decision, the Patna High Court quashed the seizure of wheat bags and the subsequent adjudication order issued by Customs authorities, finding procedural violations and arbitrary conduct during the pendency of a writ petition.
The petitioner challenged a seizure memo dated April 21, 2023, under which 35 bags of wheat (each weighing 55 kg) were seized by an Assistant Sub-Inspector (ASI) of the Sashastra Seema Bal (SSB) in West Champaran, Bihar. The wheat and the tractor used for transport were allegedly intercepted near the Indo-Nepal border, with the authorities claiming a violation of Customs and Foreign Trade laws.
Initially, the petitioner restricted his challenge to the wheat seizure. Later, as the adjudication order dated December 22, 2023 (passed during the case’s pendency), came to light, he sought to quash it as well. The High Court allowed this amendment.
The court found multiple irregularities in the seizure memo. The memo lacked the mandatory “reason to believe” as required under Section 110 of the Customs Act, 1962. It also appeared that the seizure was effected by an officer of ASI rank, who is not legally empowered to conduct such seizures under the relevant notifications.
Further, the adjudication order was passed hastily despite the pendency of the writ petition. The petitioner had informed Customs authorities of the ongoing High Court case and had even submitted documents proving the legal nature of the consignment, including GST invoices. Still, the adjudicating authority passed the order without adequately considering his submissions.
Even more concerning was the fact that the wheat bags were sold via e-auction just 29 days after dispatch of the adjudication order to the petitioner, in violation of Section 125(3) of the Customs Act. The law mandates a 120-day window to pay any redemption fine before such goods can be sold. By auctioning the goods prematurely and without clear notice, the authorities violated procedural fairness and natural justice.
As a result, the High Court quashed both the seizure memo and the confiscation order. The Court directed the Customs Department to pay the petitioner Rs. 46,200 (the assessed value of the seized wheat), along with 6% interest from the date of seizure and Rs. 5,000 towards litigation costs.
Significance or Implication of the Judgment
This judgment reinforces the principle that government authorities must strictly comply with procedural requirements under law. It provides a strong safeguard against arbitrary seizures, especially by unauthorized officers. For the public, particularly traders and transporters operating in border areas, this ruling offers reassurance that lawful business activities cannot be obstructed under vague or illegal pretexts. For government departments, it underscores the importance of observing statutory timelines, fair hearings, and judicial restraint when matters are sub-judice.
Legal Issue(s) Decided and the Court’s Decision
- Whether an Assistant Sub-Inspector of SSB is empowered to seize goods under Section 110 of the Customs Act?
- Held: No. Seizure by ASI was unauthorized and illegal.
- Whether the seizure memo complied with Section 110 of the Customs Act?
- Held: No. It lacked the required “reason to believe”.
- Was the confiscation/adjudication order valid when the writ petition was pending?
- Held: No. It was passed in haste, violating natural justice.
- Was the e-auction of seized wheat lawful?
- Held: No. Sale before expiry of 120-day redemption period violated Section 125(3) of the Customs Act.
Judgments Referred by Parties
- M/s Ashoke Das vs. Union of India & Ors., CWJC No. 4918 of 2021, disposed of on 19.02.2025
- Jayesh Agarwal vs. Union of India, CWJC No. 7085 of 2022, disposed of on 24.02.2025
- A.S. Trading and Company vs. Union of India, CWJC No. 17756 of 2024, disposed of on 25.04.2025
Judgments Relied Upon or Cited by Court
- Same as above; these precedents were followed to quash the seizure memo for lack of reasons.
Case Title
Fariyad Alam vs. The Union of India & Others
Case Number
CWJC No. 13176 of 2023
Coram and Names of Judges
Hon’ble Mr. Justice Rajeev Ranjan Prasad
Hon’ble Mr. Justice Ashok Kumar Pandey
Names of Advocates and Who They Appeared For
- For the Petitioner: Ms. Archana Meenakshee, Mr. Rohit Singh, Mr. Ranaveer Prawar
- For the Union of India: Dr. K.N. Singh, ASG; Mr. Anshuman Singh, Sr. Standing Counsel; Mr. Alok Kumar, CGC; Mr. Shivaditya Dhari Sinha
Link to Judgment
5a0056b2-fd9e-4c0d-89ac-cff54d4333cc.pdf
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