Legal principle

At the admission stage of a Customs appeal under section 130, the High Court need only find that arguable questions of law arise and decides nothing on the merits, while interim arrangements such as continued investment of a deposited redemption fine remain in force pending final orders.

Court decision

The Bombay High Court admitted the Revenue's appeal on three framed questions of law, finding that arguable questions were raised; it directed that the Rs.1.10 Crores redemption fine deposited with the Prothonotary and Senior Master continue to be invested in a nationalised bank until further orders; it left the maintainability question (section 130 versus section 130E) open to be considered at the hearing; and it expedited the hearing. The court decided nothing on the merits, so neither party prevailed on the framed questions at this stage.

Facts

The Commissioner of Customs (General) filed a Revenue appeal under section 130 of the Customs Act, 1962 against a CESTAT order dated 13.11.2024 in Customs Appeal No.85627 of 2024, which had allowed the importer's (Direct Logistics and Export Co. Ltd.) appeal and set aside the order of the Commissioner of Customs (Appeals), Mumbai-2. The dispute concerned old and used electronic components brought to the Arshiya FTWZ, which the Department treated as 'restricted goods' under Para 2.31(II) of the Foreign Trade Policy (2015-20) and the E-Waste (Management) Rules, 2016, and sought confiscation under sections 111(d), (l) and (m). The original order had allowed re-export of the goods on payment of a redemption fine; pursuant to Writ Petition No.3546 of 2025 (disposed of 09.05.2025), the goods covered by In-Bond Bills of Entry Nos.1014255, 1014266 and 1012470 were re-exported and a redemption fine of Rs.1.10 Crores was deposited with the Prothonotary and Senior Master of the Court. The Department also claimed authority to investigate goods situated within an SEZ, relying on Notification No.S.O.2667(E) dated 05.08.2016 issued under section 22 of the SEZ Act, 2005 and prior written intimation to the Development Commissioner.

Key provisions

• Section 130, Customs Act, 1962 —  Appeal to High Court
• Section 111(d), Customs Act, 1962 — Confiscation of improperly imported goods etc
• Section 130E, Customs Act, 1962 — Appeal to Supreme Court