Nageswara Trade vs Customs Department

The case of M/s Nageswara Trade vs Joint Commissioner of Customs was heard on 13 August 2025, concerning the seizure of goods imported by the petitioner. The matter was argued under Articles 226 and 227 of the Constitution of India, where the petitioner challenged the seizure of multi-functional devices including printers and photocopiers that had been imported against a Bill of Entry dated 10 September 2024. The seizure was carried out on 2 January 2025 without specifying any violation on the part of the petitioner, which became a central issue in the proceedings.

The petitioner sought relief through multiple prayers, including setting aside the seizure memo, unconditional release of the imported goods, issuance of a detention certificate to waive charges for the detained period, and any other orders deemed appropriate by the Court. It was contended that the seizure memo was handed over to the petitioner belatedly on 28 March 2025, almost three months after the date mentioned, making the seizure irregular and invalid.

Initially, the petitioner moved an application for provisional release of the goods. The Court, in its order dated 29 May 2025, permitted the petitioner to approach the Customs Department for provisional release. The Department, however, rejected the request on 16 June 2025, citing that the imported devices were prohibited under prevailing rules unless supported by Bureau of Indian Standards (BIS) certification or exemption from the Ministry of Electronics and Information Technology. The Department relied on Circular No. 35/2017-Customs which bars provisional release of prohibited goods.

The petitioner argued that this circular had already been declared void by earlier judgments, including Its My Name Pvt. Ltd. (2021) and Shanus Impex (2024), where Courts held that such restrictions went beyond the powers granted under Section 110A of the Customs Act, 1962. It was submitted that other High Courts, including Telangana and Madras, had permitted provisional release of similar goods upon imposition of reasonable conditions, demonstrating inconsistency in the Customs Department’s approach.

On the other hand, the Customs Department maintained that the petitioner had suppressed earlier petitions and that the devices were not BIS-certified. It was also argued that such goods could be hazardous and were prohibited under Section 46(4A) of the Customs Act and relevant waste management rules.

The Court, after examining the statutory provisions and earlier decisions, reiterated that Section 110A permits provisional release of seized goods pending adjudication, and that the Customs circular could not override the statute. The Court noted that provisional release could not be absolutely barred, and conditions could be imposed to protect both public interest and the revenue.

Accordingly, the Court directed that the petitioner’s goods be released provisionally on specific conditions. These included calculation of applicable duty on the goods valued at Rs. 47,56,947/-, payment of 50% of the duty by the petitioner, and execution of a bond covering any other duties or penalties that may arise. Upon fulfillment of these conditions, the goods were to be released within one week. The adjudication proceedings under the show cause notice, however, were allowed to continue in the ordinary course of law.

With these directions, the petitions and pending applications were disposed of, and the Court cancelled the next scheduled hearing date.