Legal principle

A bank account frozen under Section 110(5) of the Customs Act cannot stay frozen beyond the maximum of six months plus a six-month extension, and a pending show cause notice does not extend that period.

Court decision

Writ petition allowed. The DRI letter dated 04.08.2022 is treated as having ceased to operate because the statutory period expired. HDFC Bank must defreeze Bullion Account No.57500000622632 at once and let the firm operate it. Customs may still take any other action permitted by law.

Facts

M/s. Dhruv Jewellers, Chennai, exports gold jewellery. The Directorate of Revenue Intelligence (DRI), Chennai, searched its premises and, by a letter dated 04.08.2022, told HDFC Bank to freeze the firm's Bullion Account No.57500000622632. The firm says nothing incriminating was found. Later a show cause notice under Section 124 of the Customs Act was issued. The account stayed frozen for about four years, so the firm filed WP No. 37046 of 2026 in the Madras High Court to quash the freezing letter and have the account defrozen.

Key provisions

• Section 110(5), Customs Act, 1962 — Seizure of goods, documents and things