Legal principle

Where a confiscation order has been passed under Section 124, the seizure merges with it and a party who ignored the show cause notice and hearing must pursue the equally efficacious statutory appeal under Section 128 rather than invoke the High Court's extraordinary writ jurisdiction, which will be discouraged as 'luxurious litigation' and may attract costs.

Court decision

The writ application C.W.J.C. No. 11471 of 2024 was disposed of as infructuous, and C.W.J.C. No. 2129 of 2026 was disposed of as not entertained, with liberty to the petitioner to seek its remedy in accordance with law (the statutory appeal under Section 128). The court held that once the owner of the truck withdrew its writ unconditionally, the petitioners could not challenge the truck's seizure, and the seizure had merged into the confiscation order. Costs of Rs. 20,000 were imposed on the petitioner, payable to the Patna High Court Legal Services Committee, with limitation protection for the period from 04.02.2026 (when the petitioner first moved the court against the adjudication order). The decision was in favour of the Union of India/Department of Customs, and all questions were left open for the appellate authority.

Facts

Maa Kamakhya Traders (consignor) and Shri Sai Traders (consignee) challenged a seizure memo dated 04.12.2023 by which Customs (Preventive), Forbesganj seized 24,710 kg of Assam dried areca nut valued at Rs. 86,48,500 along with an Ashok Leyland truck under Section 110 of the Customs Act, 1962 for alleged contravention of Sections 7, 11, 46 and 47 read with Section 3(2) of the FTDR Act, 1992. An earlier writ (C.W.J.C. No. 7641 of 2024) brought by four parties including the transporter, Satyam Trans Logistics, was confined to the transporter alone and dismissed as withdrawn unconditionally on 25.07.2024. During pendency of the second writ (C.W.J.C. No. 11471 of 2024), the Assistant Commissioner issued a show cause notice dated 01.10.2024 under Section 124 to the driver-cum-owner of the vehicle, the transporter, the consignee and the consignor, but none responded or appeared for hearing. The Additional Commissioner, by Order-in-Original No. 80-Cus/ADC/FBG/2025-26 dated 26.12.2025, confiscated the areca nut with an option to redeem under Section 125(1) on payment of Rs. 2,10,00,000, and imposed a personal penalty of Rs. 2,00,000 under Section 112(b) on the proprietor of the petitioner firm, both adjustable against a Bank Guarantee of Rs. 18,16,185 furnished at provisional release.

Key provisions

• Section 110, Customs Act, 1962 — Seizure of goods, documents and things
• Section 128, Customs Act, 1962 — Appeal to Commissioner (Appeals)
• Section 124, Customs Act, 1962 — Issue of show cause notice before confiscation of goods etc
• Section 7, Customs Act, 1962 — Appointment of customs ports, airports
• Section 11, Customs Act, 1962 — Power to prohibit importation or exportation of goods
• Section 3(2), The Foreign Trade (Development and Regulation) Act, 1992 — Powers to make provisions relating to imports and exports.
• Section 46, Customs Act, 1962 — Entry of goods on importation
• Section 108, Customs Act, 1962 — Power to summon persons to give evidence and produce documents
• Section 47, Customs Act, 1962 — Clearance of goods for home consumption
• Section 112(b), Customs Act, 1962 — Penalty for improper importation of goods
• Section 125(1), Customs Act, 1962 — Option to pay fine in lieu of confiscation