Ankit Choudhary vs. The Union Of INDIA And 7 Ors

Held

The Court held that it would not be justified in adjudicating upon disputed questions relating to the valuation of seized goods or the correctness of the invoice relied upon by the petitioner, as these matters fall within the domain of the competent Adjudicating Authority. The Court noted the petitioner's dispute regarding the assessed market value of Rs. 1,40,22,500/- compared to the invoice value. Given that the seized goods were in the custody of the Customs Department and the existence of a statutory mechanism for provisional release under Section 110A of the Customs Act, the Court directed the competent Adjudicating Authority (Commissioner of Customs (Preventive), NER) to consider and dispose of the petitioner's application for provisional release. The Adjudicating Authority was instructed to determine the value of the seized goods strictly in accordance with law, pass a reasoned order addressing rival claims on valuation, and take appropriate bond, security, and conditions. The Court explicitly stated it had not expressed any opinion on the merits of the allegations, origin of goods, correctness of the invoice, or actual valuation, leaving these for the Adjudicating Authority. The exercise was to be completed expeditiously, preferably within two weeks.

Facts

The petitioner, Ankit Choudhary, proprietor of M/s Ankit Enterprises, filed a writ petition challenging the seizure of Areca Nuts and a vehicle on August 7, 2025. The seizure was effected under Section 110 of the Customs Act, 1962, on suspicion that the goods were of foreign origin. The petitioner claims the goods were duly accounted for and that he is a registered GST dealer. The investigation has been completed, and a show-cause notice was issued on August 3, 2026. The petitioner had previously applied for provisional release of the seized goods and the vehicle to the Commissioner of Customs (Preventive), NER, on March 8, 2026, which was pending.

Key Issues

1. Whether the Court should adjudicate on disputed questions of valuation and the correctness of invoices in a writ petition concerning the provisional release of seized goods under Section 110A of the Customs Act, 1962? Petitioner's Arguments: The petitioner contended that he is ready to comply with any conditions imposed for provisional release, including furnishing a bank guarantee equivalent to the value of the goods (Rs. 49,87,500/-). He argued for the release of the seized goods and the vehicle, highlighting that the statutory mechanism for provisional release exists under Section 110A of the Customs Act. Revenue's Arguments: The Customs Department, represented by the Standing Counsel, disputed the invoice annexed by the petitioner, stating it was questionable. They pointed out that the market value of the seized goods, as assessed in the Inventory of Goods Seized dated August 7, 2025, was Rs. 1,40,22,500/-, significantly higher than the value reflected in the petitioner's invoice.