Court dismisses plea for automatic release of seized gold bar, emphasizing disputed factual issues and statutory compliance under Customs Act, 1962.
In a significant ruling dated September 2, 2026, the Delhi High Court (Division Bench comprising Justices Anil Kshetarpal and Shail Jain) dismissed a writ petition filed by Saiyyada Khatoon seeking the release of a 100-gram gold bar seized by Customs authorities at Indira Gandhi International Airport. The petitioner argued that the gold bar, detained on December 19, 2023, should be released because no written show-cause notice under Section 124(a) of the Customs Act, 1962 was issued within the statutory period prescribed under Section 110(2) of the Act.
The Court’s judgment clarified the critical issue concerning the validity of oral show-cause notices under the Customs Act. While Section 124(a) mandates the issuance of a show-cause notice to the person from whom goods are seized, the first proviso to this section allows for such notice to be oral, but only if requested by the person concerned. The petitioner contended that she never requested an oral notice and thus no valid notice was issued, rendering the detention unlawful.
However, the Customs Department contested this, placing on record that an oral show-cause notice was indeed issued on the date of seizure, and that the petitioner had explicitly stated in a voluntary statement recorded under Section 108 of the Act that she did not require a show-cause notice or personal hearing. The statement also contained an admission of omission and commission on her part and her readiness to pay applicable customs duty, fine, and penalty.
The Court held that the absence of a written show-cause notice does not automatically entitle the petitioner to the release of seized goods if an oral notice was issued and factual disputes exist. It emphasized that determining compliance with Section 124(a), including whether the petitioner requested an oral notice and the nature of that notice, involves disputed facts unsuitable for adjudication under writ jurisdiction. The Court also noted that the petitioner’s allegations of coercion and procedural irregularities, including the validity of her statement and the use of CCTV footage, require detailed factual inquiry beyond the scope of a writ petition.
Notably, the Court referred to the Supreme Court’s decision in Union of India v. Jatin Ahuja (2025), which affirmed the mandatory nature of the six-month period for issuing a show-cause notice under Section 110(2). However, the Court distinguished that decision, noting that it applies where no notice of any kind has been issued within the statutory period. In the present case, since the Customs Department asserted issuance of an oral notice on the date of detention, the petitioner’s claim for automatic release could not be accepted merely based on the absence of a written notice.
The Court further clarified that it was not expressing any opinion on the ultimate liability of the petitioner, the confiscability of the gold, or the validity of the statement recorded, all of which remain to be decided by the competent Customs authority.
In conclusion, the Delhi High Court found no ground to direct the unconditional release of the gold bar and dismissed the petition. This judgment underscores the importance of understanding procedural nuances under the Customs Act and confirms that oral notices, when properly issued and requested, are valid and effective.
Bottom Line:
Customs Act, 1962 - Oral show-cause notice under Section 124(a) is permissible if requested by the person concerned. The absence of a written show-cause notice within the statutory period does not automatically entitle the petitioner to release of seized goods if an oral show-cause notice is asserted and contested factual issues exist.
Statutory provision(s):
Customs Act, 1962 Sections 108, 110(1), 110(2), 124(a)
Saiyyada Khatoon v. Commissioner of Customs, (Delhi)(DB) : Law Finder Doc Id # 2971824
