Deekshitha Sharmile

The High Court of Kerala Single Bench of Justice Ziyad Rahman A.A. held that the question of how to classify the imported edible product “Nata de Coco” is a factual issue to be resolved by the competent customs adjudicating authority through the statutory mechanism, rather than in writ proceedings under Article 226. In a petition filed by an importer challenging the seizure of consignments and the conditions imposed for their provisional release on the ground of alleged misclassification and attempted confiscation, the Court declined to interfere, observing that proceedings under Sections 110 and 124 of the Customs Act must run their course and that the sustainability of the proposed classification has to be examined exclusively in that forum, with appellate remedies preserved.

The petitioner, an importer and trader of the edible product “Nata de Coco,” approached the High Court challenging the seizure of goods by customs authorities. The goods were imported from Vietnam and classified under Customs Tariff Heading 2007 9990, as reflected in invoices and bills of entry. The petitioner relied on an official publication, the Indian Coconut Journal, to support this classification.

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The second respondent detained the goods and issued a seizure memorandum alleging misclassification. A provisional release order was passed requiring execution of a bond and furnishing of a bank guarantee. The petitioner sought modification of this order, which was rejected. The writ petition was filed challenging the seizure memorandum and the conditions imposed for provisional release, along with a request for directions regarding future consignments.

The respondents contended that the goods were misdeclared and liable to confiscation under Section 111(m) and (o) of the Customs Act, 1962. They stated that a show cause notice had been issued under Section 124 proposing confiscation. Evidence included bills of entry, invoices, certificates of origin, and communications exchanged between the parties. The respondents argued that the petition was premature since adjudication proceedings were pending under statutory provisions.

The Court recorded: “The only condition for seizing the article by invoking the power under section 110 of the Act is that, the proper officer must have reason to believe that, the goods are liable to confiscation under the Customs Act.” It further stated: “Thus what is relevant is the ‘reasonable belief’ of the officer concerned that, the goods are liable to be confiscated.”

The Court referred to Section 111 and quoted: “(m) [any goods which do not correspond in respect of value or in any other particular] with the entry made under this Act… (o) any goods exempted, subject to any condition, from duty or any prohibition in respect of the import thereof under this Act or any other law for the time being in force, in respect of which the condition is not observed unless the non-observance of the condition was sanctioned by the proper officer.”

The Court noted the petitioner’s contention: “In this case, there is nothing to indicate that, the officer concerned, while issuing Ext.P20 was under a reasonable belief as to the necessity to initiate confiscation proceedings. On this, the Court observed: “However, as far as the said contention is concerned, it cannot be decided in a writ petition at this juncture, as it is something beyond the scope of the writ petition under Art.226 of the Constitution of India.”

The Court recorded reliance on precedent: “It was held in the said decision that, the circumstances under which the officer concerned entertains reasonable belief, have to be judged from his experience eye who is well equipped to interpret the suspicious circumstances and to form a reasonable belief. It is not for the court to sit appeal over the same.”

The Court stated: “Since it is a statutory proceeding contemplated under Section 124 of the Act, which should be followed from the proceedings under section 110 of the Act, the question as to be sustainability of the classification cannot be considered by this Court in writ jurisdiction.”

Regarding the provisional release order, the Court noted: “However, in Ext.R1(b) communication, the petitioner himself sought the release of the article against a suitable bank guarantee as per the provisions of the Customs Act. Therefore, the petitioner cannot now turn around and contend that he cannot be imposed with a condition of furnishing a bank guarantee.”

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The Court directed: “In such circumstances, after considering all the relevant aspects, I am of the view that, the contentions raised by the petitioner in this writ petition cannot be considered at this stage of the proceedings and all those are matters, to be adjudicated by the statutory authorities.”

“Therefore, I do not find any merit in the writ petition and accordingly it is dismissed. However, it is clarified that, this Court did not express any opinion in respect of the classification made by the petitioner or the respondents, and the said question has to be considered by the competent authority, untrammelled by any of the observations made in this writ petition.”

Advocates Representing the Parties

For the Petitioners: Sri. M. Balagopal, Smt. R. Devika, Smt. Anjali Menon, Shri. Arjun Varghese Kuriappan, Shri. Aditya Unnikrishnan
For the Respondents: Shri. Suvin R. Menon, Senior Standing Counsel for Customs

Case Title: Sri. Shimwas Hussain v The Addl. Joint Commissioner of Customs
Neutral Citation: 2025 : KER : 90480
Case Number: WP (C) No. 33519 of 2025
Bench: Justice Ziyad Rahman A.A.