Court directs petitioner to participate in statutory adjudication, dismisses plea for unconditional release citing absence of written show cause notice but recognizes oral notice claims
In a significant ruling delivered on September 2, 2026, the Delhi High Court (Division Bench comprising Justices Anil Kshetarpal and Shail Jain) dismissed the petition filed by Awesh Karmi Fundreimayum challenging the continued detention of eight gold bars weighing 290 grams seized by Customs authorities at Indira Gandhi International Airport, New Delhi. The petitioner had sought the release of the gold bars, alleging non-issuance of a statutory written show cause notice within the prescribed period under the Customs Act, 1962.
The gold was seized on February 27, 2024, on grounds of an alleged violation of the Green Channel procedure, a route designated for travelers with nothing to declare. The petitioner contended that no written show cause notice was served within the statutory six-month period envisaged under Section 110(2) of the Customs Act, which mandates return of seized goods if no such notice is issued. He further alleged coercion in recording his statement under Section 108 of the Act, asserting that he was made to sign pre-prepared and blank documents.
The Customs department, represented by Senior Standing Counsel Vishal Chadha, countered these claims by asserting that an oral show cause notice was duly given to the petitioner on the date of seizure under the proviso to Section 124 of the Act, which permits oral notice at the request of the person concerned. The department also highlighted that the petitioner expressly waived his right to a written show cause notice and personal hearing as recorded in his Section 108 statement. Moreover, the department stated that the petitioner failed to participate in subsequent appraisement and adjudication proceedings.
The Court examined the statutory scheme under Sections 110(2) and 124 of the Customs Act, referencing the Supreme Court's authoritative judgment in Union of India v. Jatin Ahuja (2025), which emphasized the mandatory nature of the timeline for issuing show cause notices and the mandatory return of goods if the statutory period lapses without notice.
However, the Court distinguished this case from precedents where no show cause notice, oral or written, was issued. It held that the factual disputes over the validity and voluntariness of the petitioner's Section 108 statement and whether a valid oral show cause notice was given cannot be resolved in writ proceedings. Instead, these issues are to be adjudicated by the competent authority in the statutory adjudication process.
The Court declined to order the unconditional release of the gold bars, directing the petitioner to appear before the adjudicating authority on September 24, 2026, to complete the pending proceedings, including appraisement. The department was directed to provide a reasonable opportunity for personal hearing, consider all objections and material placed by the petitioner, and decide the matter within six weeks. The Court clarified that it expressed no opinion on the merits of the case or the evidentiary value of the statement under Section 108, leaving these issues to the adjudicating authority.
Additionally, the Court held that the question of detention or warehouse charges will be subject to the outcome of the adjudication proceedings.
This judgment underscores the importance of procedural compliance under the Customs Act and affirms that disputes regarding validity of notices or statements are best resolved through the designated statutory process rather than in writ jurisdiction. It also reiterates the binding principle that the statutory timeline for issuing notices cannot be circumvented, while recognizing that valid oral notices are permissible under specified conditions.
Bottom Line:
Customs Act, 1962 - Detention of goods - Oral show cause notice under Section 124 - Statutory requirement for notice cannot be waived merely by a statement - Adjudication process should be completed to resolve disputes related to detention and confiscation of goods.
Statutory provision(s):
Customs Act, 1962 Sections 108, 110(2), 124
Awesh Karmi Fundreimayum v. Commissioner of Customs, (Delhi)(DB) : Law Finder Doc Id # 2971839
