Legal principle

Seized goods cannot be retained indefinitely and must be returned under Section 110(2) if no notice under Section 124(a) is issued within the statutory period, but where the existence of a show cause notice is factually disputed and adjudication is incomplete, the writ court will direct completion of adjudication rather than order unconditional release, and the Section 124 notice requirement cannot be waived by a mere statement — an oral notice being valid only in the circumstances of the first proviso.

Court decision

The writ Petition was dismissed: the Court declined to order unconditional release of the gold bars, holding the appropriate course was to let the statutory adjudication be completed, subject to directions — the Petitioner to appear before the adjudicating authority on 24.09.2026 at 02:30 p.m., a reasonable opportunity of personal hearing with liberty to raise all objections (including on the Section 108 statement and the alleged oral show cause notice), an Order-in-Original within six weeks of his appearance subject to his cooperation, liberty to the Department to proceed per law if he fails to appear or cooperate, and detention/warehouse charges to abide the adjudication outcome. The result favoured the Respondent/Department. The Court expressly expressed no opinion on the merits and clarified it did not accept that the show cause notice requirement of Section 124 can be waived by a mere statement, an oral notice being valid only in the circumstances of the first proviso, while the Jatin Ahuja ratio on the mandatory consequence of Section 110(2) remains binding.

Facts

The Petitioner, an Indian citizen, arrived at IGI Airport, New Delhi on 27.02.2024 from Jeddah via Bahrain and was intercepted by Customs after crossing the Green Channel; a DFMD examination led to recovery of eight gold bars (SUISSE-marked, collectively about 290 grams) from a cut plastic bottle. A Detention Receipt No. DR/INDEL4/27-02-2024/003893 dated 27.02.2024 recorded the reason as 'Green Channel Violation'. The same day, a statement under Section 108 was recorded in which the Petitioner admitted ownership and intentional non-declaration and stated he did not require a show cause notice or personal hearing. The Department's chart records an oral show cause notice under the proviso to Section 124 on 27.02.2024, records that the Petitioner never appeared for appraisement, and records that no Order-in-Original has been passed. The Petition, filed on 07.01.2026, sought release of the gold and a direction that no detention or warehouse charges be recovered.

Key provisions

• Section 108, Customs Act, 1962 — Power to summon persons to give evidence and produce documents