Mr. Naveen Malhotra and Mr. Ritvik Malhotra, Advs v. COMMISSIONER OF CUSTOMS AND ANR

W.P.(C) 8461/2025 Page 2 of 23 2025 passed in the said writ petition waiving the applicable customs duty. 4. The brief facts of the case are that the Petitioner is a Canadian citizen, who arrived in India from Dubai on 18th August, 2019. The Petitioner, who is also a senior citizen, was wearing the subject gold jewellery. It is the case of the Petitioner that the subject gold jewellery are very old bangles which belonged to her mother-in-law and which were later gifted to her. However, the jewellery was seized by the Customs Department on 18th August, 2019 and a detention receipt was issued for the said seizure. 5. A show cause notice was issued on 9th October, 2019 and pursuant to the same, the Order-in-Original was passed on 31st March, 2021 directing absolute confiscation of the subject gold jewellery in the following terms: “I order absolute confiscation of the seized Fourteen (14) Gold Bangles totally weighing 1110 Grams valued at Rs. 38,44,119/- (Rupees Thirty Eight Lakhs Forty Four Thousand One Hundred and Nineteen only) which was imported by Noticee Ms. Jasvinder Kaur (D.O.B-13.06.1975) D/o Sh. Surjit Singh Sachdeva and W/o Sh. Jasmeet Singh Bhatia, under Section 111(j), 111(1), 111(m) of the Customs Act, 1962;” 6. The Petitioner had preferred appeals against the said Order-in-Original, however, no hearing was granted in the appeal. Considering the factual background and the above position, this Court, following the judgments of Directorate of Revenue Intelligence v. Pushpa Lekhumal Tolani, (2017) 16 SSC 93; Nathan Narayansamy v. Commissioner of Customs, W.P.(C) 6855/2023 decided on 15th September 2025 and Mr. Makhinder Chopra v. Commissioner of Customs New Delhi (2025: DHC: 1162-DB) vide order dated 17th April, 2025 in W.P.(C) 4851/2025 had directed as under: This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 3 of 23 “10. Since the Petitioner is a foreign citizen and the gold bangles are personal effects, the same would be fully exempted under the Baggage Rules, 2016 as well, in terms of the decision of the Supreme Court in Directorate of Revenue Intelligence v. Pushpa Lekhumal Tolani, (2017) 16 SSC 93. 11. The appeal ought to have been taken in time for hearing. Five years is a substantial period of gap. 12. Hearing notice has now been received by the Petitioner after filing of the present petition. 13. Since the hearing is fixed for 21st April, 2025, further orders are not being passed by this Court. 14. The Respondent No.1- Commissioner of Customs(Appeal) shall bear in mind the judgments relied upon by the Petitioner in the letter dated 10th February, 2025 as also the recent judgments of this Court where personal effects of foreigners have been exempted from seizure and the detention has been set aside. The details of the said judgments/orders passed by this Court are as under: ● Nathan Narayansamy v. Commissioner of Customs, W.P.(C) 6855/2023 decided on 15th September 2025 ● Mr. Makhinder Chopra v. Commissioner of Customs New Delhi (2025: DHC: 1162-DB) ● Farida Aliyeva v. Commissioner of Customs (2024: DHC: 9533-DB) ● Anjali Pandey v. Union of India & Ors. (2025: DHC: 372-DB) 15. The Respondent No.1- Commissioner of Customs (Appeal) shall pass the order by 15th May, 2025 and the said order shall be placed before this Court on 19th May, 2025. 16. List on 19th May, 2025” This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 4 of 23 As per the above order, the Court had directed the Appellate Authority to decide the Appeal by a particular fixed date and place the order before this Court. The said order came to be passed on 14th May 2025. 7. On 21st May, 2025, this Court considered the Appellate Authority’s order in W.P.(C) 4851/2025. After considering the facts and circumstances the Court had directed release of the subject gold jewellery. The operative portion of the said order reads as under: “10. Today, the matter has been taken up for hearing. Mr. Tyagi, ld. Counsel informs the Court that the Commissionerate Appeals has passed the final order dated 14th May, 2025 in this matter. The operative portion of the said order reads as under: “9.0 In light of discussions and findings as above, I allow the appeal partially against OIO No. 107/ADJ/2021 dated 19.04.2021 passed by the Joint Commissioner of Customs, T-3, IGI Airport, New Delhi and impugned goods i.e. "Fourteen (14) gold Bangles having purity 995 total weighing 1110 grams valued at Rs.38,44,119/-" is allowed to be released to the appellant/authorized person on payment of redemption fine of Rs.3,80,000/-(Rupees Three Lakh Eighty Thousand only) under Section 125 of the Customs Act, 1962 along with applicable Customs duty. The penalty on the appellant is reduced to Rs.3,50,000/- (Rupees Three Lakh Fifty Thousand Only) to be imposed under Section 112(a) & 112(b) of the Customs Act, 1962. The Appeal is disposed off with such modifications and consequential relief as above.” 11. As can be seen from the above, the Petitioner has been permitted to seek release of the goods, subject to This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 5 of 23 payment of redemption fine of Rs.3,80,000/-, applicable customs duties and penalty of Rs. 3,50,000/-. 12. Ld. Counsel for the Petitioner submits that the Petitioner is willing to undertake to re-export of the goods as the Petitioner is a Canadian national. 13. Accordingly, the custom duty is waived in the present case. The Petitioner shall pay the redemption fine and the penalty of Rs.3,80,000/- and Rs.3,50,000/- respectively. Subject to the said payment, the gold items shall be released to the Petitioner. 14. The Petitioner may either appear in person or through authorised signatory. After verifying credentials, the release shall be effected within a period of ten days from today. 15. In the facts of this case, since re-export is being agreed to by the Petitioner, no storage charges shall be collected.” 8. As can be seen from the above order dated 21st May, 2025, the Court after giving a detailed hearing to the parties, had directed release of the subject gold jewellery to the Petitioner for the purposes of re-export. Only redemption fine and penalty was directed to be paid. 9. However, to the utter shock of the Petitioner and to the consternation of this Court, the Court was thereafter informed that the subject gold jewellery were disposed of way back in the year 2021. This fact was completely concealed from this Court, when the final order was passed for release on 21st May, 2025. The Petitioner has thus preferred the present petition praying for payment of the entire market value of the subject gold jewellery. 10. On 20th June, 2025, Mr. Shubham Tyagi, ld. SSC, appearing for the This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 6 of 23 Customs Department, had submitted that the Customs Department is willing to pay the entire amount of the subject gold jewellery to the Petitioner, subject to deposit of a cancelled cheque and the detention receipt. 11. On a query from the Court, it was submitted by Mr. Tyagi, ld. SSC that the amount that would be paid to the Petitioner, would be the amount which was recovered from the sale of the subject gold jewellery in the year 2021 and not the present market rate of gold. 12. This position is not acceptable to the Petitioner and rightly so, inasmuch as, the value of gold has substantially increased in the last four years and even when the earlier Petition was finally disposed of vide order dated 21st May, 2025, this fact was not communicated to the Court. 13. After considering the above submissions, the Court had issued directions on 20th June, 2025 to the following effect: “10. Under such circumstances, the following directions are issued : (i) Issue notice. Let notice be accepted by Mr. Tyagi, ld. SSC, CBIC. Let him file a detailed counter affidavit in this matter within a period of four weeks. (ii) In the meantime, the amount, as admitted by the Customs Department shall be paid to the Petitioner within a period of two weeks, subject to the said documents being furnished by the Petitioner to the Customs Department. (iii) Whatever amount is now paid, shall be subject to the outcome of the writ petition as, in the prima facie opinion of this Court, the disposal of the gold bangles ought to have been communicated to the Court and secondly, the Petitioner’s prayer for either payment of the market value or for interest, would also have to be considered in this matter. Further, these bangles being old used jewellery which could not have been disposed of. It is also not This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 7 of 23 clear whether any notice was issued prior to the disposal of the gold items or not. All these aspects shall be dealt with in the counter affidavit.” 14. The Court had thereafter been informed that a refund order had been passed in the present matter on 8th July, 2025 and the same had been handed across by the ld. Counsel for the Petitioner. As per the said order, the refund has been calculated as under: “12. Therefore, the refund calculation is an admitted by the department is reflected in the table below: A Total admitted Value of Gold Rs.38,44,119/- B Redemption fine as per OIA CC (A) CUS/D-I/Airport/425/2025-26 dated 14.05.2025 to be set off 3,80,000/- C Penalty fine as per OIA CC (A) CUS/D-I/Airport/425/2025-26 Dated 14.05.2025 to be set off. 3,50,000/- D Customs duty @ 38.5 (Basic Custom Duty @ 35% & SWS @ 10%) Rs.14,79,986/- E Refundable Amount (D=A-B-C-D) Rs.16,34,133/- 13. Therefore an amount of Rs.16,34,133/- (Rupees Sixteen Lakh Thirty Four Thousand and One Hundred Thirty Three Only) is admissible, in compliance of the Hon’ble High Court of Delhi order dated 30.06.2025 by the department to the applicant. ORDER 14. In view of the above, I sanction the refund of Rs.16,34,133/- (Rupees Sixteen Lakh Thirty Four Thousand and One Hundred Thirty Three Only) to the Applicant and order to pay the amount of Rs.16,34,133/- (Rupees Sixteen Lakh Thirty Four Thousand and One Hundred Thirty Three Only) to the This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 8 of 23 applicant through RTGS against Cheque No.089208 dated 08.07.2025 issued to PNB, Sansad Marg, New Delhi.” 15. In terms of the directions given in the refund order, a sum of Rs.16,34,133/- has been paid to the Petitioner after deduction of the customs duty and penalty. However, it is noted by the Court that the total weight of gold which was disposed of is 1110 grams. The market value of the same today would be over Rs. 1 crore for which the Petitioner has been paid only a sum of Rs.16,34,133/-. The deduction of customs duty is also completely untenable since this Court had already waived the same vide order dated 21st May, 2025 in W.P.(C) 4851/2025 as also considering that the Petitioner is a Canadian citizen and she was willing to re-export the subject gold jewellery. 16. It is also necessary to note that the order for re-export was already passed by this Court in its order dated 21st May, 2025 in W.P.(C) 4851/2025. However, even at that stage, the Customs Department had not disclosed that the subject gold jewellery had already been disposed of. 17. Considering the above facts, this Court on 10th September, 2025 has directed as under: “17. Under these circumstances, this Court is of the opinion that the disposal of the subject gold jewellery itself is shrouded under doubt. Moreover, the refund order is conspicuously silent about when the subject gold jewellery was disposed of and how much money was recovered by the Customs Department as also the procedure followed for disposal of the same. 18. Considering the above as also the fact that the quantity of the subject gold jewellery was substantial i.e., 1110 grams, let the Assistant Commissioner This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 9 of 23 (Refunds), file an affidavit on record giving all the details as under: i) Whether any intimation was given to the Petitioner prior to the disposal of the subject gold jewellery and if so, by what means; ii) What was the exact procedure followed for disposal of the subject gold jewellery and how much was recovered by the Customs Department; iii) Whether the factum of disposal of the subject gold jewellery was intimated to the concerned Adjudicating Authority or the Appellate Authority, or not, before passing of the respective Order-in-Original and Order-in-Appeal. 19. Let the proof, if any, of the intimation provided to the Petitioner before disposal of the subject gold jewellery, and all other supporting documents in respect of the above issues be placed on record along with the said affidavit. 20. Let the said affidavit be filed within a period of one week. 21. In addition, the original file relating to the disposal of the gold shall be produced before the Court on the next date.” 18. Today, an affidavit has been handed over by the ld. SSC for the Customs Department which has been signed by Mr. Birendra Singh Khati working as the Assistant Commissioner at the IGI Airport, New Delhi. On the various queries raised by the Court on the last date, the answer of the Customs Department is as under: Query No. 1 – Whether any intimation was given to the Petitioner prior to the This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 10 of 23 disposal of the subject gold jewellery and if so, by what means. 19. Answer – As per the said affidavit according to the Customs Department, the subject gold jewellery was disposed of in terms of Section 110(1A), (1B) and (1C) of the Customs Act, 1962. The Customs Department is stated to have filed an application before the Executive Magistrate, Chanakyapuri and the goods were disposed of. The order of the ld. Magistrate dated 25th March, 2021 has been filed as per which it is recorded as under: “The Present application under Section 110 (1B) of the Customs Act 1962, is listed on 24.03.2021 for verification of Panchnama dated 18.08.2019. As per directions of this court, case property i.e., sealed plastic container is produced by the Case Property In charge Customs in intact condition sealed with Customs seal. Case property cannot be opened without breaking of the seals. A paper slip is also found affixed with the sealed plastic container. The plastic container is having particulars of the case and DR No. 46624 dated 18.08.2019 The plastic container is directed to be opened. On opening the plastic container wrapped with adhesive tape, it was found to contain 14 Gold Bangles total weighing 1110 Gms., as detailed below:- Sr No Description of Gold Total weight 1 14 Gold Bangles 1110 grams Total 1110 grams Details of the aforesaid 14 Gold Bangles total weighing 1110 Gms., tallied with the Panchnama dated 18.08.2019 and it is observed that the weight of the above gold was mentioned as 1110 Gms in the said Panchnama and the same is found to be (total) weighing 1109 gms during the pre-trial proceedings. The Panchnama, lying in the departmental case file, is also produced before me by the officer of the Customs and after going through the same, I am of the opinion This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 11 of 23 that the photocopy of the Panchnama dated 18.08.2019 which was filed by the department with the application under Section 110 (1B) of the Customs Act, 1962, is the same. Case property opened and its quantity/weight and sealing tallied with the Panchnama dated 18.08,2019 and actual weight of the above gold is found to be 1109 Gms whereas 1110 Gms was mentioned in Panchnama dated 18.08.2019 . The Photographer and Videographer who are present during the proceedings have taken photographs and recorded the proceedings in my presence. The seized goods are kept back in the plastic container from which it was taken out and the said box with the seized gold is further wrapped with customs tape. The said plastic box is sealed with wire and metal seal "CUSTOMS W1 IGI" with Customs plier seal over a paper slip bearing DR No. 46624 dated 18.08.2019 and signature of the concerned officers. The said sealed box is then again wrapped with customs tape. Further, I put my dated signature on the Panchnama dated 18.08.2019, paper slip (DR slip) and photographs taken during the proceedings. Photographs are directed to be kept in the departmental case file. Copy of the proceedings conducted under Section 110(1C) of the Customs Act 1962, is directed to be given to the I.O. of the case through Ld. SPP Sh. Vishal Chadha.” 20. Various officers of the Customs Department were present when this order was passed. The interesting aspect is that in paragraph 6 of this affidavit, it is stated as under: “6. That with respect to first detail sought by the Hon’ble Court i.e. "(i) Whether any intimation was given to the petitioner prior to the disposal of the subject gold jewellery and if so, by what means". It is submitted that at the time of disposal (RFD issued on 26.03.2021.) there was no such provision to intimate the passenger This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 12 of 23 before disposal of the gold. At that time Pre-trial was conducted before the court of SDM.” 21. Thus, the Customs Department admits that at no point prior to disposal of the subject gold jewellery, the Petitioner was given any intimation that the Department is proposing to dispose of the same. Query No.2 – What was the exact procedure followed for disposal of the subject gold jewellery and how much was recovered by the Customs Department. 22. Answer – In respect to this query, the stand of the Customs Department is that the person/pax is usually intercepted at the exit gate of the Customs arrival hall of the airport and the passenger is taken to the Customs’ preventive room in the arrival hall and is served the notice informing about the personal search and search of baggage. If any gold is found, a case is booked and the same is entered into the register. The Investigating Officer prepares the files with the relevant documents along with the details of any gold, contraband or incriminating item. After seizure, the same is deposited in the godown. The disposal of the gold is stated to be done as per Section 110 (1D) of the Customs Act, 1962. In terms thereof, in the present case, the matter relates to prior to the inclusion of Section 110(1D). Accordingly, it is stated as under: “8. It is submitted that in the present case also since the period under dispute pertains to prior to inclusion of Section 110 (1D), the disposal of seized gold kadas weighing 1100 gms was executed in compliance of Section 110(1A), (1B) & (1C) of the Customs Act, 1962. The Respondents have filed an application Before the Executive Magistrate, Chanakyapuri, under Section 110 (1B) of the Customs Act which was allowed and only after issuance of Pre-trail certificate by the Ld. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 13 of 23 Magistrate the said goods were disposed of. 9. It is also submitted that the Net amount recovered by the Customs Department Rs.50,17,490/- (Email communication received from Disposal branch/Calculation Sheet enclosed as Annexure-B)” 23. From the above, it is clear that the total net amount received from the Customs Department was Rs.50,17,490/- after the pre-trial certificate was issued by the ld. Magistrate. Query No.3 – Whether the factum of disposal of the subject gold jewellery was intimated to the concerned Adjudicating Authority or the Appellate Authority, or not, before passing of the respective Order-in-Original and Order-in-Appeal. 24. Answer – On the third query, the Customs Department submits as under: “10. That with respect to third detail sought by the Hon’ble Court i.e iii) Whether the factum of disposal of the subject gold jewellery was intimated to the concerned Adjudicating Authority or the Appellate Authority, or not, before passing of the respective Order-in-Original and Order-in-Appeal. In this regard, it is submitted that factum of disposal of the subject gold jewellery was not intimated to the concerned Adjudicating Authority or the Appellate Authority since there was no such practice to intimate any Section / Branch for disposal of Gold. Now, concerned Branch has started to intimate the status of Disposal of gold after handing over to SPMCIL. 11. It is also submitted that that the goods were released to the applicant for re-export only and for re-export of the goods, no Customs Duty is applicable. But in instant case the goods have been consumed indigenously and the applicant has submitted bank details of Indian bank i.e. HDFC Bank of This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 14 of 23 Barakhambha Branch, New Delhi. Hence, as per provision of the Customs Act, 1962, the Customs Duty was deducted from the total refundable amount. 12. Further, Regarding value taken for the purpose of the refund it is submitted that the Hon’ble High Court of Delhi order in W.P.(C) 8461/2025 dated 20.06.2025 stated in para (ii) of 10 as under: "10(ii) In the meantime, the amount, as admitted by the Customs Department shall be paid to the Petitioner within a period of two weeks, subject to the said documents being furnished by the Petitioner to the Customs Department." 13. That as per direction of the Hon’ble Court, the amount as admitted by the Customs department is the base of granting refund to the applicant, which is Rs.38,44,119/-. Hence the same was taken into account for granting refund. 14. In view of the above, since the seizure, disposal, issuance of SCN/OIO are in accordance of law, it is requested that the refund order dated 08.07.2025 be upheld.” 25. The above reveals that the Customs Department follows an unusual practice of not informing the Adjudicating Authority or the Appellate Authority of the factum of the disposal of the gold. This is shocking to say the least. Firstly, the gold has been disposed of without informing the person concerned. Secondly, the Customs Department follows a surreptitious practice of not informing the Adjudicating Authority or the Appellate Authority leading to an order where the Petitioner has in fact succeeded before the Appellate Authority and release of the goods was directed subject to payment of redemption fine, customs duty and penalty. This order was thereafter modified by this Court on 21st May, 2025 allowing re-export. 26. Throughout this entire period, the sale of the subject gold jewellery was This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 15 of 23 not intimated. This practice can hardly be stated to be fair or just. There is another point of concern to this Court. Even when the Court directed the Commissioner (Refund) to pass the order and compute the amount payable to the Petitioner. The amount which is taken to be the value of gold is not the amount which was recovered i.e., Rs.50,17,490/- but Rs.38,44,119/- which in fact reveals complete mala fides on behalf of the Customs Department. Thus, even the refund order is completely unsustainable. 27. The following facts emerge from the above discussion: i) The subject gold jewellery has been sold without any intimation to the Petitioner; ii) The sale of the subject gold jewellery was not intimated even to the Adjudicating Authority or the Appellate Authority; iii) The refund order did not capture the net amount recovered by the Customs Department i.e., Rs.50,17,490/-. It is not even clear till date as to what is the gross amount which was recovered and how the net amount has been arrived at; iv) An amount of Rs.38,44,119/- has been taken as the admitted value of the gold for which also, there is no basis. 28. The subject gold jewellery items in effect have been completely confiscated, seized and destroyed by the Customs Department without complying with even the basic principles of natural justice. 29. The Petitioner having succeeded has been completely defeated due to the conduct of the Customs Department. Under similar circumstances, this Court in Gor Sharian v. The Commissioner of Customs (2025 DHC 950-DB) has held as under: “13. Thus, the following glaring facts have come to This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 16 of 23 the notice of this Court in this petition: (i) The Order-in-Appeal dated 26th July, 2022 was either not communicated or was completely ignored by the said authority. (ii) The detained gold was disposed of on 29th November, 2022 without proper intimation to the Petitioner. (iii) The Order-in-Appeal had permitted release of the detained gold to the Petitioner, subject to payment of redemption fine and penalty. The said redemption fine and the penalty of a sum of Rs.7,00,000/- and Rs. 2,20,000/-was paid by the Petitioner on 8th December, 2021 and 8th May, 2023, respectively. On the date of the second deposit, the detained gold itself was disposed of, however, the redemption fine and penalty was still accepted by the Department. (iv) There was no proper communication or intimation given to the Petitioner prior to the disposal of the detained gold. (v) The disposal of the detained gold was also not informed to this Court, when the order dated 20th July, 2023 was passed. (vi) The impugned Refund Order was passed on 3rd October, 2024. The operative portion of the said order reads as under: “17. Return of tariff value of 1065.10 grams of confiscated gold amounting to Rs. 50,14,704/- (Rupees Fifty Lakh Fourteen Thousand Seven Hundred and Four Only) in lieu of the re-export of the same after realizing the Redemption Fine of Rs. 4,60,000/- and Penalty of Rs. 4,60,000/- and order to pay an amount of Rs. 50,14,704/- (Rupees Fifty Lakh Fourteen Thousand Seven Hundred and Four Only) to the applicant/Authorized representative through RTGS against Cheque No. 604890 Dated. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 17 of 23 10.2024 issued to PNB, Sansad Marg, New Delhi.” As per the impugned Refund order, the confiscated gold has been valued at Rs.50,14,704/-, after realizing the redemption fine which has been deposited along with the penalty. (vii) To further compound the irregularities, the impugned Corrigendum Order is then issued, holding the Petitioner liable for customs duty, further reducing the amount payable in the following terms: “Refund of Rs. 29,46,139/- (Twenty Nine Lakh Forty Six Thousand One Hundred Thirty Nine Only) in lieu of re-export of the confiscated gold after realizing the applicable duty of Rs. 20,68,565/-, Redemption fine of Rs. 4,60,0001- and penalty of Rs. 4,60,0001- and order to pay an amount of Rs. Rs. 29,46,139/- (Twenty Nine Lakh Forty Six Thousand One Hundred Thirty Nine Only) to the applicant1Authorized representative through RTGS against Cheque No. 604894 Dated. 01.2025 issued to PNB, Sansad Marg, New Delhi.” 14. The above conduct of the Customs Department is completely unreasonable, arbitrary and untenable. The Ld. Counsel for the Department has relied upon a Circular dated 6th September, 2022, which prescribes the manner in which the gold has to be returned. The relevant paragraph of the said Circular is extracted hereinbelow: “3.1.2 Whenever seized gold has to be returned on account of any order from a judicial forum and the gold has already been disposed of, the amount to be refunded in lieu of such gold shall be calculated as given below: i. If the seizure is made in the Customs area, calculation shall be based on the tariff value This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 18 of 23 of gold on the date of transfer of such seized/confiscated gold to SPMCIL; and ii. If the seizure is made at any place other than Customs area, calculation shall be based on the average market price of gold on the date of transfer of such seized/confiscated gold to SPMCIL.” 15. The chronology of events set out above would show that there is a triple benefit being claimed by the Department: (i) Firstly, the detained gold has been disposed of long back without intimation to the Petitioner, at much less the value of the gold as of today – despite the Order-in-Appeal; (ii) Despite having disposed of the detained gold, the redemption fine and penalty has been accepted by the Department; (iii) Further, duty payable at 41.25% is being deducted without paying the amount of the value of the detained gold to the Petitioner. 16. In the opinion of this Court, this course of action would be completely contrary to law inasmuch as the Order-in-Appeal had clearly directed the release and re-export of the detained gold, subject to payment of redemption fine and penalty. The said order could not have been ignored by the Customs Department. Even if there was a lack of communication, the fact of disposal of the detained gold ought to have been communicated to the Court, when the W.P. (C) No. 6690/2023 was being heard and the final order therein was passed on 20th July, 2023. 17. The disposal of the detained gold without intimation to the Petitioner is also contrary to law. Clause 3.1.2 of the Circular dated 6th September, 2022 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 19 of 23 would, therefore, have no application in the present case. The entire process followed by the Customs Department for the disposal of the detained gold, collecting the redemption fine and penalty as also deducting customs duty before payment of the value of the detained gold to the Petitioner would, therefore, not be tenable. 18. The Petitioner having succeeded in appeal before the Commissioner of Customs (Appeals) and the Customs Department having not challenged the Order-in-Appeal, the Petitioner cannot be made worse off at this stage. 19. Under these circumstances, this Court is of the opinion that the Petitioner is entitled to the entire value of the detained gold as on the market rate prevalent today, which would be liable to be paid by the Customs Department within a period of three weeks. If the said amount is not paid within three weeks, costs of Rs.1,00,000/- would be liable to be paid by the Customs Department to the Petitioner. 20. It is made clear that no duty would be liable to be deducted from the said payment of the value of the detained gold as the Petitioner has already deposited the redemption fine and penalty in terms of the Order-in-Appeal. 21. The said amount shall be credited to the Petitioner’s bank account directly. The Petitioner shall provide his bank details to the official concerned from his registered Email:- [email protected]. Mr. Gibran Naushad, ld. Senior Standing Counsel shall ensure that the Petitioner speaks to the official concerned before the remittance is paid. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 20 of 23 22. In addition, the Customs Department shall ensure in future that the intimation of disposal of detained or confiscated property is given to the concerned party both via email as also the mobile number, so that the said party who has succeeded in Court or Tribunal against the detention of the property, are not deprived of their properties, as has happened in the present case.” 30. This order in Gor Sharian (Supra) was challenged before the Supreme Court in SLP (C). 10725/2025 titled Commissioner of Customs v. Gor Sharian and vide order dated 28th April, 2025, the Supreme Court did not interfere with the said order. The said order of the Supreme Court reads as under: “Heard the learned Additional Solicitor General appearing for the Petitioner. On facts, no case for interference is made out in exercise of our jurisdiction under Article 136 of the Constitution of India. The Special Leave Petition is accordingly dismissed. Pending application, if any, also stands disposed of.” 31. Ld. Counsel for the Petitioner has also relied upon Leyla Mehmoodi and Anr. V. Additional Commissioner of Customs, 2023 SSC OnLine Bom 2742, a decision of the Bombay High Court where the Court has in fact equated such destruction of gold as depriving the owner of the goods of his property. The relevant paragraphs of the said judgment are extracted below: “xxx xxx xxx 41. Be that as it may, as noted above, now the proceedings which had arisen under the show-cause notice dated July 6, 2018 issued to the petitioners have attained finality in view of the revisional authority passing an order on September 19, 2022, whereby it has been held that absolute confiscation was not justified in This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 21 of 23 the present case and the petitioners be permitted to re-export the gold jewellery on payment of a redemption fine. Such order as seen from the facts as noted above is incapable of compliance, inasmuch as, the gold jewellery itself is not available for the petitioners to re-export it. This more significantly as the revisional authority having observed that this was not the case where the petitioners. have attempted to smuggle the gold. 42. As rightly urged on behalf of the petitioners, the Assistant Commissioner who disposed of the gold never informed either the appellate authority or the revisional authority that the seized gold jewellery of the petitioners itself was not available and was disposed of. This, in our opinion, is something which raises a serious doubts on the method and manner in which the customs officers discharge their duties under the Act. In our opinion, even if there is a power to dispose of the gold, it has to be exercised fairly, reasonably and transparently. Disposal of the property belonging to the persons like the petitioners and/or to sell the seized goods at the ipse dixit of the officers, is not what the law would recognise. The procedure to dispose of such valuable commodities is required to withstand the test of law and more particularly, the Constitutional requirement of reasonableness, non-arbitrariness, fairness and transparency as enshrined under article 14 of the Constitution coupled with safeguarding the valuable rights of property recognized by the Constitution, under article 300A. It cannot be otherwise, as section 110(1A) would be required to be read, interpreted and applied only in a manner the basic law of land under the provisions of articles, 14 and 300A of the Constitution of India, would permit the Department to so apply. 43. As noted above sub-section (1A) of section 110 cannot be read as absolute. entitlement or authority with the proper officer to dispose of the items like gold in the absence of any This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 22 of 23 cogent reasons, which would attract the ingredients of sub-section (1A) of section 110. Such reasons as falling under sub-section (1A) are required to be intimated to the owner of the goods for the reason that ultimately the disposal of the goods would entail-serious consequences of affecting the Constitutional rights of the owner of the goods guaranteed under article 300A of the Constitution, as the owner would be deprived of his property. This would be the basic requirement of law the proper officer dealing with any goods, which are merely seized and not confiscated would be required to be followed. This for the reason that prior to the goods being confiscated, rights in the goods, the corporeal ownership of the goods remain with the owner of the goods and such rights do not stand vested and/or transferred in favour of the Customs Department/Government.” 32. In the background of these facts, this Court directs that the Petitioner shall now be paid the market rate of the gold prevalent today for 1110 grams. The value of the gold at today’s market rate shall be paid within a period of one month. If the amount is not paid within the period of one month, further costs of Rs.1 lakh would be liable to be paid by the Customs Department to the Petitioner. 33. It is made clear that from the market rate, the amount already paid to the Petitioner in terms of the refund order i.e., 16,34,133/- shall be deducted. 34. No further amounts would be liable to be deducted. The amounts shall be credited straight away to the Petitioner’s bank account. 35. Petition is disposed of in these terms. All pending applications, if any, are also disposed of. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 23 of 23 36. List for compliance on 25th November, 2025. PRATHIBA M. SINGH, J. SHAIL JAIN, J. SEPTEMBER 19, 2025 Rahul/Ck

W.P.(C) 8461/2025 Page 2 of 23 2025 passed in the said writ petition waiving the applicable customs duty. 4. The brief facts of the case are that the Petitioner is a Canadian citizen, who arrived in India from Dubai on 18th August, 2019. The Petitioner, who is also a senior citizen, was wearing the subject gold jewellery. It is the case of the Petitioner that the subject gold jewellery are very old bangles which belonged to her mother-in-law and which were later gifted to her. However, the jewellery was seized by the Customs Department on 18th August, 2019 and a detention receipt was issued for the said seizure. 5. A show cause notice was issued on 9th October, 2019 and pursuant to the same, the Order-in-Original was passed on 31st March, 2021 directing absolute confiscation of the subject gold jewellery in the following terms: “I order absolute confiscation of the seized Fourteen (14) Gold Bangles totally weighing 1110 Grams valued at Rs. 38,44,119/- (Rupees Thirty Eight Lakhs Forty Four Thousand One Hundred and Nineteen only) which was imported by Noticee Ms. Jasvinder Kaur (D.O.B-13.06.1975) D/o Sh. Surjit Singh Sachdeva and W/o Sh. Jasmeet Singh Bhatia, under Section 111(j), 111(1), 111(m) of the Customs Act, 1962;” 6. The Petitioner had preferred appeals against the said Order-in-Original, however, no hearing was granted in the appeal. Considering the factual background and the above position, this Court, following the judgments of Directorate of Revenue Intelligence v. Pushpa Lekhumal Tolani, (2017) 16 SSC 93; Nathan Narayansamy v. Commissioner of Customs, W.P.(C) 6855/2023 decided on 15th September 2025 and Mr. Makhinder Chopra v. Commissioner of Customs New Delhi (2025: DHC: 1162-DB) vide order dated 17th April, 2025 in W.P.(C) 4851/2025 had directed as under: This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 3 of 23 “10. Since the Petitioner is a foreign citizen and the gold bangles are personal effects, the same would be fully exempted under the Baggage Rules, 2016 as well, in terms of the decision of the Supreme Court in Directorate of Revenue Intelligence v. Pushpa Lekhumal Tolani, (2017) 16 SSC 93. 11. The appeal ought to have been taken in time for hearing. Five years is a substantial period of gap. 12. Hearing notice has now been received by the Petitioner after filing of the present petition. 13. Since the hearing is fixed for 21st April, 2025, further orders are not being passed by this Court. 14. The Respondent No.1- Commissioner of Customs(Appeal) shall bear in mind the judgments relied upon by the Petitioner in the letter dated 10th February, 2025 as also the recent judgments of this Court where personal effects of foreigners have been exempted from seizure and the detention has been set aside. The details of the said judgments/orders passed by this Court are as under: ● Nathan Narayansamy v. Commissioner of Customs, W.P.(C) 6855/2023 decided on 15th September 2025 ● Mr. Makhinder Chopra v. Commissioner of Customs New Delhi (2025: DHC: 1162-DB) ● Farida Aliyeva v. Commissioner of Customs (2024: DHC: 9533-DB) ● Anjali Pandey v. Union of India & Ors. (2025: DHC: 372-DB) 15. The Respondent No.1- Commissioner of Customs (Appeal) shall pass the order by 15th May, 2025 and the said order shall be placed before this Court on 19th May, 2025. 16. List on 19th May, 2025” This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 4 of 23 As per the above order, the Court had directed the Appellate Authority to decide the Appeal by a particular fixed date and place the order before this Court. The said order came to be passed on 14th May 2025. 7. On 21st May, 2025, this Court considered the Appellate Authority’s order in W.P.(C) 4851/2025. After considering the facts and circumstances the Court had directed release of the subject gold jewellery. The operative portion of the said order reads as under: “10. Today, the matter has been taken up for hearing. Mr. Tyagi, ld. Counsel informs the Court that the Commissionerate Appeals has passed the final order dated 14th May, 2025 in this matter. The operative portion of the said order reads as under: “9.0 In light of discussions and findings as above, I allow the appeal partially against OIO No. 107/ADJ/2021 dated 19.04.2021 passed by the Joint Commissioner of Customs, T-3, IGI Airport, New Delhi and impugned goods i.e. "Fourteen (14) gold Bangles having purity 995 total weighing 1110 grams valued at Rs.38,44,119/-" is allowed to be released to the appellant/authorized person on payment of redemption fine of Rs.3,80,000/-(Rupees Three Lakh Eighty Thousand only) under Section 125 of the Customs Act, 1962 along with applicable Customs duty. The penalty on the appellant is reduced to Rs.3,50,000/- (Rupees Three Lakh Fifty Thousand Only) to be imposed under Section 112(a) & 112(b) of the Customs Act, 1962. The Appeal is disposed off with such modifications and consequential relief as above.” 11. As can be seen from the above, the Petitioner has been permitted to seek release of the goods, subject to This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 5 of 23 payment of redemption fine of Rs.3,80,000/-, applicable customs duties and penalty of Rs. 3,50,000/-. 12. Ld. Counsel for the Petitioner submits that the Petitioner is willing to undertake to re-export of the goods as the Petitioner is a Canadian national. 13. Accordingly, the custom duty is waived in the present case. The Petitioner shall pay the redemption fine and the penalty of Rs.3,80,000/- and Rs.3,50,000/- respectively. Subject to the said payment, the gold items shall be released to the Petitioner. 14. The Petitioner may either appear in person or through authorised signatory. After verifying credentials, the release shall be effected within a period of ten days from today. 15. In the facts of this case, since re-export is being agreed to by the Petitioner, no storage charges shall be collected.” 8. As can be seen from the above order dated 21st May, 2025, the Court after giving a detailed hearing to the parties, had directed release of the subject gold jewellery to the Petitioner for the purposes of re-export. Only redemption fine and penalty was directed to be paid. 9. However, to the utter shock of the Petitioner and to the consternation of this Court, the Court was thereafter informed that the subject gold jewellery were disposed of way back in the year 2021. This fact was completely concealed from this Court, when the final order was passed for release on 21st May, 2025. The Petitioner has thus preferred the present petition praying for payment of the entire market value of the subject gold jewellery. 10. On 20th June, 2025, Mr. Shubham Tyagi, ld. SSC, appearing for the This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 6 of 23 Customs Department, had submitted that the Customs Department is willing to pay the entire amount of the subject gold jewellery to the Petitioner, subject to deposit of a cancelled cheque and the detention receipt. 11. On a query from the Court, it was submitted by Mr. Tyagi, ld. SSC that the amount that would be paid to the Petitioner, would be the amount which was recovered from the sale of the subject gold jewellery in the year 2021 and not the present market rate of gold. 12. This position is not acceptable to the Petitioner and rightly so, inasmuch as, the value of gold has substantially increased in the last four years and even when the earlier Petition was finally disposed of vide order dated 21st May, 2025, this fact was not communicated to the Court. 13. After considering the above submissions, the Court had issued directions on 20th June, 2025 to the following effect: “10. Under such circumstances, the following directions are issued : (i) Issue notice. Let notice be accepted by Mr. Tyagi, ld. SSC, CBIC. Let him file a detailed counter affidavit in this matter within a period of four weeks. (ii) In the meantime, the amount, as admitted by the Customs Department shall be paid to the Petitioner within a period of two weeks, subject to the said documents being furnished by the Petitioner to the Customs Department. (iii) Whatever amount is now paid, shall be subject to the outcome of the writ petition as, in the prima facie opinion of this Court, the disposal of the gold bangles ought to have been communicated to the Court and secondly, the Petitioner’s prayer for either payment of the market value or for interest, would also have to be considered in this matter. Further, these bangles being old used jewellery which could not have been disposed of. It is also not This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 7 of 23 clear whether any notice was issued prior to the disposal of the gold items or not. All these aspects shall be dealt with in the counter affidavit.” 14. The Court had thereafter been informed that a refund order had been passed in the present matter on 8th July, 2025 and the same had been handed across by the ld. Counsel for the Petitioner. As per the said order, the refund has been calculated as under: “12. Therefore, the refund calculation is an admitted by the department is reflected in the table below: A Total admitted Value of Gold Rs.38,44,119/- B Redemption fine as per OIA CC (A) CUS/D-I/Airport/425/2025-26 dated 14.05.2025 to be set off 3,80,000/- C Penalty fine as per OIA CC (A) CUS/D-I/Airport/425/2025-26 Dated 14.05.2025 to be set off. 3,50,000/- D Customs duty @ 38.5 (Basic Custom Duty @ 35% & SWS @ 10%) Rs.14,79,986/- E Refundable Amount (D=A-B-C-D) Rs.16,34,133/- 13. Therefore an amount of Rs.16,34,133/- (Rupees Sixteen Lakh Thirty Four Thousand and One Hundred Thirty Three Only) is admissible, in compliance of the Hon’ble High Court of Delhi order dated 30.06.2025 by the department to the applicant. ORDER 14. In view of the above, I sanction the refund of Rs.16,34,133/- (Rupees Sixteen Lakh Thirty Four Thousand and One Hundred Thirty Three Only) to the Applicant and order to pay the amount of Rs.16,34,133/- (Rupees Sixteen Lakh Thirty Four Thousand and One Hundred Thirty Three Only) to the This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 8 of 23 applicant through RTGS against Cheque No.089208 dated 08.07.2025 issued to PNB, Sansad Marg, New Delhi.” 15. In terms of the directions given in the refund order, a sum of Rs.16,34,133/- has been paid to the Petitioner after deduction of the customs duty and penalty. However, it is noted by the Court that the total weight of gold which was disposed of is 1110 grams. The market value of the same today would be over Rs. 1 crore for which the Petitioner has been paid only a sum of Rs.16,34,133/-. The deduction of customs duty is also completely untenable since this Court had already waived the same vide order dated 21st May, 2025 in W.P.(C) 4851/2025 as also considering that the Petitioner is a Canadian citizen and she was willing to re-export the subject gold jewellery. 16. It is also necessary to note that the order for re-export was already passed by this Court in its order dated 21st May, 2025 in W.P.(C) 4851/2025. However, even at that stage, the Customs Department had not disclosed that the subject gold jewellery had already been disposed of. 17. Considering the above facts, this Court on 10th September, 2025 has directed as under: “17. Under these circumstances, this Court is of the opinion that the disposal of the subject gold jewellery itself is shrouded under doubt. Moreover, the refund order is conspicuously silent about when the subject gold jewellery was disposed of and how much money was recovered by the Customs Department as also the procedure followed for disposal of the same. 18. Considering the above as also the fact that the quantity of the subject gold jewellery was substantial i.e., 1110 grams, let the Assistant Commissioner This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 9 of 23 (Refunds), file an affidavit on record giving all the details as under: i) Whether any intimation was given to the Petitioner prior to the disposal of the subject gold jewellery and if so, by what means; ii) What was the exact procedure followed for disposal of the subject gold jewellery and how much was recovered by the Customs Department; iii) Whether the factum of disposal of the subject gold jewellery was intimated to the concerned Adjudicating Authority or the Appellate Authority, or not, before passing of the respective Order-in-Original and Order-in-Appeal. 19. Let the proof, if any, of the intimation provided to the Petitioner before disposal of the subject gold jewellery, and all other supporting documents in respect of the above issues be placed on record along with the said affidavit. 20. Let the said affidavit be filed within a period of one week. 21. In addition, the original file relating to the disposal of the gold shall be produced before the Court on the next date.” 18. Today, an affidavit has been handed over by the ld. SSC for the Customs Department which has been signed by Mr. Birendra Singh Khati working as the Assistant Commissioner at the IGI Airport, New Delhi. On the various queries raised by the Court on the last date, the answer of the Customs Department is as under: Query No. 1 – Whether any intimation was given to the Petitioner prior to the This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 10 of 23 disposal of the subject gold jewellery and if so, by what means. 19. Answer – As per the said affidavit according to the Customs Department, the subject gold jewellery was disposed of in terms of Section 110(1A), (1B) and (1C) of the Customs Act, 1962. The Customs Department is stated to have filed an application before the Executive Magistrate, Chanakyapuri and the goods were disposed of. The order of the ld. Magistrate dated 25th March, 2021 has been filed as per which it is recorded as under: “The Present application under Section 110 (1B) of the Customs Act 1962, is listed on 24.03.2021 for verification of Panchnama dated 18.08.2019. As per directions of this court, case property i.e., sealed plastic container is produced by the Case Property In charge Customs in intact condition sealed with Customs seal. Case property cannot be opened without breaking of the seals. A paper slip is also found affixed with the sealed plastic container. The plastic container is having particulars of the case and DR No. 46624 dated 18.08.2019 The plastic container is directed to be opened. On opening the plastic container wrapped with adhesive tape, it was found to contain 14 Gold Bangles total weighing 1110 Gms., as detailed below:- Sr No Description of Gold Total weight 1 14 Gold Bangles 1110 grams Total 1110 grams Details of the aforesaid 14 Gold Bangles total weighing 1110 Gms., tallied with the Panchnama dated 18.08.2019 and it is observed that the weight of the above gold was mentioned as 1110 Gms in the said Panchnama and the same is found to be (total) weighing 1109 gms during the pre-trial proceedings. The Panchnama, lying in the departmental case file, is also produced before me by the officer of the Customs and after going through the same, I am of the opinion This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 11 of 23 that the photocopy of the Panchnama dated 18.08.2019 which was filed by the department with the application under Section 110 (1B) of the Customs Act, 1962, is the same. Case property opened and its quantity/weight and sealing tallied with the Panchnama dated 18.08,2019 and actual weight of the above gold is found to be 1109 Gms whereas 1110 Gms was mentioned in Panchnama dated 18.08.2019 . The Photographer and Videographer who are present during the proceedings have taken photographs and recorded the proceedings in my presence. The seized goods are kept back in the plastic container from which it was taken out and the said box with the seized gold is further wrapped with customs tape. The said plastic box is sealed with wire and metal seal "CUSTOMS W1 IGI" with Customs plier seal over a paper slip bearing DR No. 46624 dated 18.08.2019 and signature of the concerned officers. The said sealed box is then again wrapped with customs tape. Further, I put my dated signature on the Panchnama dated 18.08.2019, paper slip (DR slip) and photographs taken during the proceedings. Photographs are directed to be kept in the departmental case file. Copy of the proceedings conducted under Section 110(1C) of the Customs Act 1962, is directed to be given to the I.O. of the case through Ld. SPP Sh. Vishal Chadha.” 20. Various officers of the Customs Department were present when this order was passed. The interesting aspect is that in paragraph 6 of this affidavit, it is stated as under: “6. That with respect to first detail sought by the Hon’ble Court i.e. "(i) Whether any intimation was given to the petitioner prior to the disposal of the subject gold jewellery and if so, by what means". It is submitted that at the time of disposal (RFD issued on 26.03.2021.) there was no such provision to intimate the passenger This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 12 of 23 before disposal of the gold. At that time Pre-trial was conducted before the court of SDM.” 21. Thus, the Customs Department admits that at no point prior to disposal of the subject gold jewellery, the Petitioner was given any intimation that the Department is proposing to dispose of the same. Query No.2 – What was the exact procedure followed for disposal of the subject gold jewellery and how much was recovered by the Customs Department. 22. Answer – In respect to this query, the stand of the Customs Department is that the person/pax is usually intercepted at the exit gate of the Customs arrival hall of the airport and the passenger is taken to the Customs’ preventive room in the arrival hall and is served the notice informing about the personal search and search of baggage. If any gold is found, a case is booked and the same is entered into the register. The Investigating Officer prepares the files with the relevant documents along with the details of any gold, contraband or incriminating item. After seizure, the same is deposited in the godown. The disposal of the gold is stated to be done as per Section 110 (1D) of the Customs Act, 1962. In terms thereof, in the present case, the matter relates to prior to the inclusion of Section 110(1D). Accordingly, it is stated as under: “8. It is submitted that in the present case also since the period under dispute pertains to prior to inclusion of Section 110 (1D), the disposal of seized gold kadas weighing 1100 gms was executed in compliance of Section 110(1A), (1B) & (1C) of the Customs Act, 1962. The Respondents have filed an application Before the Executive Magistrate, Chanakyapuri, under Section 110 (1B) of the Customs Act which was allowed and only after issuance of Pre-trail certificate by the Ld. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 13 of 23 Magistrate the said goods were disposed of. 9. It is also submitted that the Net amount recovered by the Customs Department Rs.50,17,490/- (Email communication received from Disposal branch/Calculation Sheet enclosed as Annexure-B)” 23. From the above, it is clear that the total net amount received from the Customs Department was Rs.50,17,490/- after the pre-trial certificate was issued by the ld. Magistrate. Query No.3 – Whether the factum of disposal of the subject gold jewellery was intimated to the concerned Adjudicating Authority or the Appellate Authority, or not, before passing of the respective Order-in-Original and Order-in-Appeal. 24. Answer – On the third query, the Customs Department submits as under: “10. That with respect to third detail sought by the Hon’ble Court i.e iii) Whether the factum of disposal of the subject gold jewellery was intimated to the concerned Adjudicating Authority or the Appellate Authority, or not, before passing of the respective Order-in-Original and Order-in-Appeal. In this regard, it is submitted that factum of disposal of the subject gold jewellery was not intimated to the concerned Adjudicating Authority or the Appellate Authority since there was no such practice to intimate any Section / Branch for disposal of Gold. Now, concerned Branch has started to intimate the status of Disposal of gold after handing over to SPMCIL. 11. It is also submitted that that the goods were released to the applicant for re-export only and for re-export of the goods, no Customs Duty is applicable. But in instant case the goods have been consumed indigenously and the applicant has submitted bank details of Indian bank i.e. HDFC Bank of This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 14 of 23 Barakhambha Branch, New Delhi. Hence, as per provision of the Customs Act, 1962, the Customs Duty was deducted from the total refundable amount. 12. Further, Regarding value taken for the purpose of the refund it is submitted that the Hon’ble High Court of Delhi order in W.P.(C) 8461/2025 dated 20.06.2025 stated in para (ii) of 10 as under: "10(ii) In the meantime, the amount, as admitted by the Customs Department shall be paid to the Petitioner within a period of two weeks, subject to the said documents being furnished by the Petitioner to the Customs Department." 13. That as per direction of the Hon’ble Court, the amount as admitted by the Customs department is the base of granting refund to the applicant, which is Rs.38,44,119/-. Hence the same was taken into account for granting refund. 14. In view of the above, since the seizure, disposal, issuance of SCN/OIO are in accordance of law, it is requested that the refund order dated 08.07.2025 be upheld.” 25. The above reveals that the Customs Department follows an unusual practice of not informing the Adjudicating Authority or the Appellate Authority of the factum of the disposal of the gold. This is shocking to say the least. Firstly, the gold has been disposed of without informing the person concerned. Secondly, the Customs Department follows a surreptitious practice of not informing the Adjudicating Authority or the Appellate Authority leading to an order where the Petitioner has in fact succeeded before the Appellate Authority and release of the goods was directed subject to payment of redemption fine, customs duty and penalty. This order was thereafter modified by this Court on 21st May, 2025 allowing re-export. 26. Throughout this entire period, the sale of the subject gold jewellery was This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 15 of 23 not intimated. This practice can hardly be stated to be fair or just. There is another point of concern to this Court. Even when the Court directed the Commissioner (Refund) to pass the order and compute the amount payable to the Petitioner. The amount which is taken to be the value of gold is not the amount which was recovered i.e., Rs.50,17,490/- but Rs.38,44,119/- which in fact reveals complete mala fides on behalf of the Customs Department. Thus, even the refund order is completely unsustainable. 27. The following facts emerge from the above discussion: i) The subject gold jewellery has been sold without any intimation to the Petitioner; ii) The sale of the subject gold jewellery was not intimated even to the Adjudicating Authority or the Appellate Authority; iii) The refund order did not capture the net amount recovered by the Customs Department i.e., Rs.50,17,490/-. It is not even clear till date as to what is the gross amount which was recovered and how the net amount has been arrived at; iv) An amount of Rs.38,44,119/- has been taken as the admitted value of the gold for which also, there is no basis. 28. The subject gold jewellery items in effect have been completely confiscated, seized and destroyed by the Customs Department without complying with even the basic principles of natural justice. 29. The Petitioner having succeeded has been completely defeated due to the conduct of the Customs Department. Under similar circumstances, this Court in Gor Sharian v. The Commissioner of Customs (2025 DHC 950-DB) has held as under: “13. Thus, the following glaring facts have come to This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 16 of 23 the notice of this Court in this petition: (i) The Order-in-Appeal dated 26th July, 2022 was either not communicated or was completely ignored by the said authority. (ii) The detained gold was disposed of on 29th November, 2022 without proper intimation to the Petitioner. (iii) The Order-in-Appeal had permitted release of the detained gold to the Petitioner, subject to payment of redemption fine and penalty. The said redemption fine and the penalty of a sum of Rs.7,00,000/- and Rs. 2,20,000/-was paid by the Petitioner on 8th December, 2021 and 8th May, 2023, respectively. On the date of the second deposit, the detained gold itself was disposed of, however, the redemption fine and penalty was still accepted by the Department. (iv) There was no proper communication or intimation given to the Petitioner prior to the disposal of the detained gold. (v) The disposal of the detained gold was also not informed to this Court, when the order dated 20th July, 2023 was passed. (vi) The impugned Refund Order was passed on 3rd October, 2024. The operative portion of the said order reads as under: “17. Return of tariff value of 1065.10 grams of confiscated gold amounting to Rs. 50,14,704/- (Rupees Fifty Lakh Fourteen Thousand Seven Hundred and Four Only) in lieu of the re-export of the same after realizing the Redemption Fine of Rs. 4,60,000/- and Penalty of Rs. 4,60,000/- and order to pay an amount of Rs. 50,14,704/- (Rupees Fifty Lakh Fourteen Thousand Seven Hundred and Four Only) to the applicant/Authorized representative through RTGS against Cheque No. 604890 Dated. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 17 of 23 10.2024 issued to PNB, Sansad Marg, New Delhi.” As per the impugned Refund order, the confiscated gold has been valued at Rs.50,14,704/-, after realizing the redemption fine which has been deposited along with the penalty. (vii) To further compound the irregularities, the impugned Corrigendum Order is then issued, holding the Petitioner liable for customs duty, further reducing the amount payable in the following terms: “Refund of Rs. 29,46,139/- (Twenty Nine Lakh Forty Six Thousand One Hundred Thirty Nine Only) in lieu of re-export of the confiscated gold after realizing the applicable duty of Rs. 20,68,565/-, Redemption fine of Rs. 4,60,0001- and penalty of Rs. 4,60,0001- and order to pay an amount of Rs. Rs. 29,46,139/- (Twenty Nine Lakh Forty Six Thousand One Hundred Thirty Nine Only) to the applicant1Authorized representative through RTGS against Cheque No. 604894 Dated. 01.2025 issued to PNB, Sansad Marg, New Delhi.” 14. The above conduct of the Customs Department is completely unreasonable, arbitrary and untenable. The Ld. Counsel for the Department has relied upon a Circular dated 6th September, 2022, which prescribes the manner in which the gold has to be returned. The relevant paragraph of the said Circular is extracted hereinbelow: “3.1.2 Whenever seized gold has to be returned on account of any order from a judicial forum and the gold has already been disposed of, the amount to be refunded in lieu of such gold shall be calculated as given below: i. If the seizure is made in the Customs area, calculation shall be based on the tariff value This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 18 of 23 of gold on the date of transfer of such seized/confiscated gold to SPMCIL; and ii. If the seizure is made at any place other than Customs area, calculation shall be based on the average market price of gold on the date of transfer of such seized/confiscated gold to SPMCIL.” 15. The chronology of events set out above would show that there is a triple benefit being claimed by the Department: (i) Firstly, the detained gold has been disposed of long back without intimation to the Petitioner, at much less the value of the gold as of today – despite the Order-in-Appeal; (ii) Despite having disposed of the detained gold, the redemption fine and penalty has been accepted by the Department; (iii) Further, duty payable at 41.25% is being deducted without paying the amount of the value of the detained gold to the Petitioner. 16. In the opinion of this Court, this course of action would be completely contrary to law inasmuch as the Order-in-Appeal had clearly directed the release and re-export of the detained gold, subject to payment of redemption fine and penalty. The said order could not have been ignored by the Customs Department. Even if there was a lack of communication, the fact of disposal of the detained gold ought to have been communicated to the Court, when the W.P. (C) No. 6690/2023 was being heard and the final order therein was passed on 20th July, 2023. 17. The disposal of the detained gold without intimation to the Petitioner is also contrary to law. Clause 3.1.2 of the Circular dated 6th September, 2022 This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 19 of 23 would, therefore, have no application in the present case. The entire process followed by the Customs Department for the disposal of the detained gold, collecting the redemption fine and penalty as also deducting customs duty before payment of the value of the detained gold to the Petitioner would, therefore, not be tenable. 18. The Petitioner having succeeded in appeal before the Commissioner of Customs (Appeals) and the Customs Department having not challenged the Order-in-Appeal, the Petitioner cannot be made worse off at this stage. 19. Under these circumstances, this Court is of the opinion that the Petitioner is entitled to the entire value of the detained gold as on the market rate prevalent today, which would be liable to be paid by the Customs Department within a period of three weeks. If the said amount is not paid within three weeks, costs of Rs.1,00,000/- would be liable to be paid by the Customs Department to the Petitioner. 20. It is made clear that no duty would be liable to be deducted from the said payment of the value of the detained gold as the Petitioner has already deposited the redemption fine and penalty in terms of the Order-in-Appeal. 21. The said amount shall be credited to the Petitioner’s bank account directly. The Petitioner shall provide his bank details to the official concerned from his registered Email:- [email protected]. Mr. Gibran Naushad, ld. Senior Standing Counsel shall ensure that the Petitioner speaks to the official concerned before the remittance is paid. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 20 of 23 22. In addition, the Customs Department shall ensure in future that the intimation of disposal of detained or confiscated property is given to the concerned party both via email as also the mobile number, so that the said party who has succeeded in Court or Tribunal against the detention of the property, are not deprived of their properties, as has happened in the present case.” 30. This order in Gor Sharian (Supra) was challenged before the Supreme Court in SLP (C). 10725/2025 titled Commissioner of Customs v. Gor Sharian and vide order dated 28th April, 2025, the Supreme Court did not interfere with the said order. The said order of the Supreme Court reads as under: “Heard the learned Additional Solicitor General appearing for the Petitioner. On facts, no case for interference is made out in exercise of our jurisdiction under Article 136 of the Constitution of India. The Special Leave Petition is accordingly dismissed. Pending application, if any, also stands disposed of.” 31. Ld. Counsel for the Petitioner has also relied upon Leyla Mehmoodi and Anr. V. Additional Commissioner of Customs, 2023 SSC OnLine Bom 2742, a decision of the Bombay High Court where the Court has in fact equated such destruction of gold as depriving the owner of the goods of his property. The relevant paragraphs of the said judgment are extracted below: “xxx xxx xxx 41. Be that as it may, as noted above, now the proceedings which had arisen under the show-cause notice dated July 6, 2018 issued to the petitioners have attained finality in view of the revisional authority passing an order on September 19, 2022, whereby it has been held that absolute confiscation was not justified in This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 21 of 23 the present case and the petitioners be permitted to re-export the gold jewellery on payment of a redemption fine. Such order as seen from the facts as noted above is incapable of compliance, inasmuch as, the gold jewellery itself is not available for the petitioners to re-export it. This more significantly as the revisional authority having observed that this was not the case where the petitioners. have attempted to smuggle the gold. 42. As rightly urged on behalf of the petitioners, the Assistant Commissioner who disposed of the gold never informed either the appellate authority or the revisional authority that the seized gold jewellery of the petitioners itself was not available and was disposed of. This, in our opinion, is something which raises a serious doubts on the method and manner in which the customs officers discharge their duties under the Act. In our opinion, even if there is a power to dispose of the gold, it has to be exercised fairly, reasonably and transparently. Disposal of the property belonging to the persons like the petitioners and/or to sell the seized goods at the ipse dixit of the officers, is not what the law would recognise. The procedure to dispose of such valuable commodities is required to withstand the test of law and more particularly, the Constitutional requirement of reasonableness, non-arbitrariness, fairness and transparency as enshrined under article 14 of the Constitution coupled with safeguarding the valuable rights of property recognized by the Constitution, under article 300A. It cannot be otherwise, as section 110(1A) would be required to be read, interpreted and applied only in a manner the basic law of land under the provisions of articles, 14 and 300A of the Constitution of India, would permit the Department to so apply. 43. As noted above sub-section (1A) of section 110 cannot be read as absolute. entitlement or authority with the proper officer to dispose of the items like gold in the absence of any This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 22 of 23 cogent reasons, which would attract the ingredients of sub-section (1A) of section 110. Such reasons as falling under sub-section (1A) are required to be intimated to the owner of the goods for the reason that ultimately the disposal of the goods would entail-serious consequences of affecting the Constitutional rights of the owner of the goods guaranteed under article 300A of the Constitution, as the owner would be deprived of his property. This would be the basic requirement of law the proper officer dealing with any goods, which are merely seized and not confiscated would be required to be followed. This for the reason that prior to the goods being confiscated, rights in the goods, the corporeal ownership of the goods remain with the owner of the goods and such rights do not stand vested and/or transferred in favour of the Customs Department/Government.” 32. In the background of these facts, this Court directs that the Petitioner shall now be paid the market rate of the gold prevalent today for 1110 grams. The value of the gold at today’s market rate shall be paid within a period of one month. If the amount is not paid within the period of one month, further costs of Rs.1 lakh would be liable to be paid by the Customs Department to the Petitioner. 33. It is made clear that from the market rate, the amount already paid to the Petitioner in terms of the refund order i.e., 16,34,133/- shall be deducted. 34. No further amounts would be liable to be deducted. The amounts shall be credited straight away to the Petitioner’s bank account. 35. Petition is disposed of in these terms. All pending applications, if any, are also disposed of. This is a digitally signed order. The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/09/2025 at 12:37:40 W.P.(C) 8461/2025 Page 23 of 23 36. List for compliance on 25th November, 2025. PRATHIBA M. SINGH, J. SHAIL JAIN, J. SEPTEMBER 19, 2025 Rahul/Ck