Madras High Court
M/S.Unique Sales Corporation vs The Principal Commissioner Of Customs ... on 18 November, 2025
Author: N.Anand Venkatesh
Bench: N.Anand Venkatesh
W.P.No.44597 of 2025
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 18.11.2025
CORAM
THE HONOURABLE Mr.JUSTICE N.ANAND VENKATESH
W.P.No.44597 of 2025
AND
W.M.P.Nos.49748 & 49749 of 2025
M/s.Unique Sales Corporation
Rep. by its Partner Mr.Tarique Masood
No.7/3A, Gopal Chandra Lane
Kolkata 700 073 ... Petitioner
Vs.
1.The Principal Commissioner of Customs (Chennai-III)
(Preventive)
Custom House, No.60, Rajaji Salai, Chennai – 600 001
2.The Intelligence Officer, DRI (Hqrs.)
Directorate of Revenue Intelligence
7th Floor, Drum Shaped Building
I.P.Bhawan, I.P.Estate, New Delhi 110 002
3.The Additional Commissioner of Customs (NDR-FTWZ)
O/o.The Principal Commissioner of Customs
Preventive Commissionerate
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W.P.No.44597 of 2025
Custom House, No.60, Rajaji Salai
Chennai – 600 001 ... Respondents
Petition filed under Article 226 of the Constitution of India praying for
issuance of Writ of Certiorarified Mandamus, calling for the records in
F.No.DRI/CI/ENQ/125/2025-CI-O/o DG-DRI-HQ-DELHI/1750 dated 28.05.2025,
nd
passed by the 2 respondent herein in petitioner's Bill of Entry No.8456751, dated
20.02.2025 and quash the same as illegal, arbitrary, unfair, un-reasonable, violation
of principles of natural justice and perverse insofar intimating for provisional
release of the goods in adhering to the provisions provided under Section 110A of
the Customs Act, read with the guidelines issued through Board Circular
No.35/2017-Customs, dated 16.08.2017, which has been held as void and
unenforceable at law by Hon’ble Division Bench of Delhi High Court and direct
the respondents herein to release the goods viz., 4,44,657 SQM of PA coated fabric
imported vide Bill of Entry No.8456751, dated 20.02.2025, totally valued at USD
9,782.45 for 4,44,657 SQM, on execution of simple bond for the differential duty
on the re-determined value and also on execution of simple bond towards the
adjudication levies if any.
For Petitioner : Mr.A.K.Jayaraj
For RR1 & 3 : Mr.Nalinidhar
Standing Counsel
For R2 : Mr.Sai Srujan Tayi &
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W.P.No.44597 of 2025
Mr.Bharath Gowtham
ORDER
This writ petition has been filed challenging the Seizure Memo dated
28.05.2025 passed by the 2nd respondent and for a consequential direction to the
respondents to release the goods on execution of Simple Bond for the Differential
Duty on the re-determined value and also on execution of Simple Bond towards the
adjudication levies, if any.
2. Heard both sides.
3. The petitioner had placed order with a supplier in China for supply of PA
Coated Fabric and one of the consignments reached the Chennai Port and the same
was also taken to the SEZ Ware House in Nandiampakkam, Chennai. The
petitioner had imported 4,44,657 SQM of PA Coated Fabrics from China, valued at
total USD 9,782.45. The goods were shipped under invoice dated 15.01.2025 and
the Bill of Entry was filed dated 20.02.2025 and the petitioner claim for clearance
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of the goods.
4. The petitioner had submitted all the necessary documents and also filed
the Bill of Entry and sought for the clearance of the goods by declaring the value
of the goods. The petitioner requested further release of the goods.
5. The petitioner would submit that on an earlier occasion they had imported
similar goods and got necessary clearance from the office of the 2nd respondent and
on that pretext, he requested for release of the goods. Thereafter, the authorities
had de-stuffed the goods and conducted examination of the goods. Subsequently,
the samples were sent for testing. The authorities had informed the petitioner that
the release of the goods would be subject to the test result of the sample.
6. At this juncture, the petitioner received the impugned seizure memo dated
28.05.2025 from the 2nd respondent stating that as per the CRCL Test Report, the
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goods have to be re-classified and therefore, the seized goods were liable for
confiscation and were placed under seizure in terms of Section 110(1) of the
Customs Act. The impugned seizure memo has also drawn reference to the
provisions of provisional release in terms of Section 110A of the Customs Act read
with guidelines issued under Board Circular No.35/2017-Customs, dated
16.08.2017.
7. The petitioner aggrieved by the impugned seizure memo dated
28.05.2025, issued by the 2nd respondent, has approached this Court.
8. The petitioner would further submit that the subject goods were freely
importable goods and cheaper in price. He also added that identical goods were
already assessed and released by the Customs Officers, by accepting the value
declared in the Bill of Entry.
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9. The learned counsel for the petitioner submitted that the provisional
release order was issued by placing reliance upon the guidelines issued under
CBIC Circular No.35/2017-Customs, dated 16.08.2017, became a subject matter of
challenge before the Delhi High Court and it was struck down as contrary to
Section 110A of the Customs Act and was held to be void and unenforceable in
law. To substantiate this submission, the learned counsel relied upon the Division
Bench judgment of the Delhi High Court in the case of Additional Director
General (Adjudication) Vs. Its My Name Pvt., Ltd., reported in 2021 (375) E.L.T.
545 (Del.). The learned counsel further brought to the notice of this Court that the
Apex Court confirmed the judgment of the Delhi High Court by dismissing the
S.L.P by order dated 01.10.2020.
10. The learned counsel, therefore, submitted that there was absolutely no
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nd
justification on the part of the 2 respondent to impose onerous conditions as a
condition precedent for release of the goods and accordingly, contended that the
impugned order drawing reference to provisional release order is liable to be
interfered by this Court.
11. Per contra, the learned Standing Counsel appearing on behalf of the
respondents submitted that the Apex Court did not go into the validity or otherwise
of the judgment of the Delhi High Court, since the particular case, which went on
an appeal before the Hon'ble Supreme Court, the Apex Court merely took into
consideration the submission made by the learned Senior Counsel appearing on
behalf of the assessee reporting no objection for the enhancement of the quantum
of the Bank Guarantee and accordingly, the Apex Court merely modified the order
of the High Court with respect to the quantum of Bank Guarantee and disposed of
the S.L.P. The learned Standing Counsel further submitted that the adjudication is
yet to take place and at that point of time, if any additional duty, fine or penalty is
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imposed against the petitioner, there must be some security available with the
Department for recovering the same. Hence, it was contended that there is
absolutely no reason for interfering with the provisional release order.
12. This Court has carefully considered the submissions made on either side
and the materials available on record.
13. This Court is not dealing with the merits of the case since what has been
put to challenge is the provisional release order and that too questioning some of
the onerous conditions. While undertaking this exercise, it will suffice to take note
of some of the earlier orders passed by this Court. One such order was passed in
the case of Green Line Vs. Commissioner of Customs, Chennai -IV, reported in
2016 (340) E.L.T 140 (Mad). That was also a case, which involved differential
duty of non prohibited goods. Similar conditions were imposed and the said writ
petition was disposed of by this Court in the following terms:
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“8. In the light of the above discussions, the Writ Petition is disposed of
with the following directions:
(i) The petitioner is directed to remit the entire duty as assessed by them;
(ii) The petitioner is directed to pay 50% of the differential duty which has
been arrived at by the Department as Rs. 22.72 lakhs;
(iii) The petitioner is directed to execute a bond for the remaining amount
to the satisfaction of the respondents.
(iv) The petitioner shall execute an indemnity bond stating that in the
event of Shir.S. Ariya raising any claim over the goods or concerning the use of
IEC code issued in favour of M/s. Green Line, the petitioner Mr. Mohamed Kalith
alone would be fully responsible for the same and no liability can be fastened on
the respondent Department and the indemnity bond should be furnished in the
form approved by the respondents.”
14. This order of the learned Single Judge was subsequently confirmed by
the Hon'ble Division Bench of this Court in W.A.No.1243 of 2016 dated
25.10.2016. It is also relevant to take note of a Division Bench order of this Court
in the case of Commissioner of Customs and Others vs. Sri Venkateshwara Paper
Boards Rep.by its General Manager Mr. L. Barath reported in 2022 (379) E.L.T
310 (Mad), which involved prohibited goods and the writ petition was disposed of
in the following terms:
“32. We have perused the order dated 29.12.2020 permitting provisional
release of the cargo, subject to the following conditions:
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(a) execution of a bond for Rs. 34,65,334/-,
(b) production of cash security/bank guarantee for Rs. 12,12,867/-
towards redemption fine and penalty, and
(c) payment of duty of Rs. 9,43,411/-.
33. We find nothing unreasonable about conditions (a) and (c), however
condition (b) is concerned directing the Importer to furnish Bank guarantee/cash
security towards redemption fine and penalty would be harsh as the show-cause
notice is yet to be adjudicated. Therefore, we modify the condition (b) alone by
directing the Importer to execute the bond for Rs. 12,12,867/-.
34. On compliance of the execution of the bond for the amount mentioned
in conditions (a) and (b) supra and payment of duty as mentioned in condition (c),
the Revenue shall permit provisional release of the cargo within seven (7) days
therefrom, which shall be subject to the result of the adjudication of the show-
cause notice.”
15. In the case in hand, the goods that are involved are PA Coated Fabrics,
which according to the Department has been misclassified and undervalued.
Therefore, the Department is proceeding further with the adjudication proceedings.
Pending the same, the impugned order has been passed.
nd
16. In the impugned order, the 2 respondent has stated as follows:
"Whereas the goods declared as “PA COATED FABRIC" imported vide
Bill of Entry No.8456751 dated 20.02.2025 by M/s. Unique Sales Corporation
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(IEC:0209002867), 7/3A, Gopal Chandra Lane, Kolkata, W.B.-700 073, filed
through SEZ Unit M/s.Malj Lines Pvt. Ltd., Nandiambakkam, Ponneri Taluk,
Chennai-600 120, appears to be appropriately classifiable under CTH 54076900,
as ascertained from the CRCL Test Report, as against the declared CTH
59039090 declared in the Bill of Entry.
In view of the above, there is a reason to believe that the goods imported
vide the Bill of Entry No.8456751 dated 20.02.2025 are liable for confiscation in
terms of section 111(m) of the Customs Act, 1962. Therefore, the subject goods
are hereby placed under seizure under the provisions of Section 110(1) ibid.
Further, your attention is drawn to the provisions of provisional release of
the seized goods provided under section 110A of the Customs Act, 1962 read with
the guidelines issued through Board's Circular No.35/2017 – Customs, dated
16.08.2017.”
17. Taking into consideration the facts and circumstances of the case
and considering the grounds raised in the writ petition and also taking into
consideration of the earlier orders passed by this Court, this Court is inclined
to modify the conditions imposed in the provisional release order as follows:
a)The petitioner is directed to remit the entire duty as declared by them;
b)The petitioner is directed to pay 50% of the differential duty for the total
value arrived at by the Department;
c)The petitioner is directed to execute a bond on re-determined value arrived
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by the Department; and
d)The petitioner shall also execute a bond for value of goods in respect of
adjudication levies, if any. On compliance, the goods shall be released by the
respondent within a period of seven (7) days from the date of compliance of
the conditions.
18. The above conditions will suffice to take care of the interest of the
Department and at the same time, the petitioner will also be able to get the goods
released in its favour.
19. Subject to the compliance of the above conditions, goods shall be
released by the respondents. The Department is directed to proceed further with the
adjudication and the petitioner shall co-operate during the adjudication proceedings
to ensure that it is completed as expeditiously as possible.
In the result, the writ petition is disposed of in the above terms.
No costs. Connected W.M.Ps are closed.
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18.11.2025
gya
Index : Yes/No
Neutral Citation : Yes/No
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To
1.The Principal Commissioner of Customs (Chennai-III)
(Preventive)
Custom House, No.60, Rajaji Salai, Chennai – 600 001
2.The Intelligence Officer, DRI (Hqrs.)
Directorate of Revenue Intelligence
7th Floor, Drum Shaped Building
I.P.Bhawan, I.P.Estate, New Delhi 110 002
3.The Additional Commissioner of Customs (NDR-FTWZ)
O/o.The Principal Commissioner of Customs
Preventive Commissionerate
Custom House, No.60, Rajaji Salai
Chennai – 600 001
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N.ANAND VENKATESH, J.
gya
18.11.2025
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