Indirect Tax Weekly Flashback for the period 23 February to 1 March 2025.
Delhi High Court
Oral Waiver Of Show Cause Notice And Personal Hearing In A Standard Form Is Not Lawful: Delhi High Court Releases NRI’s Rolex Wrist Watch Seized By Customs Dept.
Case Title: Mohamed Shamiuddeen Versus Commissioner Of Customs
The Delhi High Court had released NRI’s Rolex wrist watch seized by the customs department and held that oral waiver of show cause notice and personal hearing in a standard form is not lawful.
The bench of Justice Prathiba M. Singh and Justice Dharmesh Sharma has observed that where the Department is relying upon the standard form undertaking signed by the Petitioner waiving the show cause notice and personal hearing. Clearly, the Department had the email address and the mobile number of the Petitioner. Thus, after not receiving a reply to the email dated 20th February, 2024, the Department could have issued a proper show cause notice within the time prescribed as per law. None of this was done. No hearing was also granted.
Delhi High Court Denies Release of USD 24,500 In Tourist’s Currency Seizure Case, Awaits Appeal Adjudication
Case Title: Dilaram Shamuratovna Versus Union Of India
The Delhi High Court has ruled that the release of USD 24,500 seized from a tourist at IGI Airport cannot be granted until the pending appeal is adjudicated.
The bench of Justice Prathiba M. Singh and Justice Dharmesh Sharma has observed that since the clear instructions are that the Department has challenged the Order-in-Original dated 29th March, 2024, the Commissioner (Appeals) must now adjudicate the appeal in accordance with the law. Until such adjudication, the prayer for the release of the currency cannot be granted.
Customs Dept. Disposes Detained Gold Without Intimation To Russian National: Delhi High Court Directs Dept. To Pay Value Of Detained Gold As Per Market Rate
Case Title: Gor Sharian Versus The Commissioner Of Customs
The Delhi High Court has directed the department to pay the entire value of detained gold as per market rate as the customs department disposes of detained gold without intimation to Russian National.
The bench of Justice Prathiba M. Singh and Justice Dharmesh Sharma has observed that the disposal of the detained gold without intimation to the Petitioner is also contrary to law. The entire process followed by the Customs Department for the disposal of the detained gold, collecting the redemption fine and penalty as also deducting customs duty before payment of the value of the detained gold to the Petitioner would, therefore, not be tenable.
Delhi High Court Directs Customs Dept. To Discontinue Practice Of Making Tourists Sign Undertaking In Standard Form Waiving SCN
Case Title: Mr Makhinder Chopra Versus Commissioner Of Customs New Delhi
The Delhi High Court has directed the customs dept. to discontinue practice of making tourists sign undertaking in standard form waiving show cause notice and personal hearing is contrary to the provisions of Section 124 of the Customs Act.
The bench of Justice Prathiba M. Singh and Justice Dharmesh Sharma has stated that the Customs Department is expected to follow the principles of natural justice in each case where goods are confiscated in terms of Section 124 of the Customs Act.
Limited Applicability Of Baggage Rules On Foreign Tourists: Delhi High Court Directs Release Of Russian National’s Gold Chain
Case Title: Mr Makhinder Chopra Versus Commissioner Of Customs New Delhi
The Delhi High Court has directed the release of Russian National’s gold chain observing that there is a limited applicability of Baggage Rules on foreign tourists.
The bench of Justice Prathiba M. Singh and Justice Dharmesh Sharma has observed that on the ground of limited applicability of the Baggage Rules to the tourist of foreign origin and as jewellery is part of personal effects, the detention of Petitioner’s gold chain would have to be set aside.
Bombay High Court
Volkswagen Faces $1.4 Billion Tax Demand: Bombay High Court Unconvinced by Automaker’s Arguments, Commends Customs Officer’s Research
The Bombay High Court has expressed skepticism regarding Volkswagen’s defense against a $1.4 billion tax demand issued by Indian Customs authorities.
Kerala High Court
Forged Use Of Customs Dept. Seal By Employee: Kerala High Court Quashes Penalty Against Employer
Case Title: M/S MBK Logistics Private Limited Versus The Commissioner Of Customs
The Kerala High Court has held that the employer is not vicariously liable for forged use of the customs department seal by the employee.
Patna High Court
Quashing Of Seizure Memo Doesn’t Mean Customs Dept. Can’t Investigate: Patna High Court
Case Title: M/s Ashoke Das Versus Union of India
The Patna High Court has held that the quashing of the seizure memo does not mean the customs department cannot investigate and proceed in accordance with law under the provisions of the Customs Act, 1962.
The bench of Justice Rajeev Ranjan Prasad and Justice Shailendra Singh has observed that apart from the seizure list, there is no other order of the Seizing Officer showing his reason to believe. Mere mentioning of the sections of the Customs Act, 1962 in the seizure memo would not be sufficient in absence of material information relating to ‘reason to believe.’
