Facts of the Case

This writ petition before the Gujarat High Court concerned the seizure of an imported consignment of confectionery and chocolate products under the Customs Act, 1962, on grounds of non-compliance with food safety regulations. This is a Customs/FSSAI compliance matter; GST is not at issue anywhere in this order.

The petitioner, M/s Food Mart, was transporting a consignment of imported goods — including Nescafe Instant Coffee, Trident Chewing Gum, Samyang Mix Noodles, and various chocolate products (Ferrero, Kinder Bueno, Nutella, Fruitella, Bounty, Snickers, Mars, Twix and Cadbury) — from Mundra Port to Mumbai, when the truck was intercepted by Customs authorities on 24.03.2022. The goods, valued at Rs. 1,48,67,363/-, and the vehicle, valued at Rs. 21,71,250/-, were seized on 13.04.2022 by way of a Seizure Memo-cum-No Objection for Provisional Release, and placed under confiscation proceedings under Sections 110(1), 111 and 115 of the Customs Act, on the ground of non-observance of the Food Safety and Standards Act, 2006, the Food Safety Standard Rules, 2011, and the Food Safety and Standard (Import) Regulation, 2017 — including absence of the Food Safety and Standards logo, license number, importer details, and Veg/Non-Veg labelling. The petitioner sought a direction for immediate provisional release and re-export of the goods.

Issues Involved

  1. Whether the petitioner was entitled to a direction for immediate provisional release of the seized goods under Section 110A of the Customs Act.
  2. Whether the petitioner could additionally be permitted to re-export the seized goods.

Petitioner's Arguments

  • Sought a direction to the Customs authorities to immediately order provisional release and re-export of the goods seized under the Seizure Memo dated 13.04.2022.
  • Relied on the Gujarat High Court's earlier decision in Zip Zap Exim (P) Ltd. vs. Union of India, [2020 (35) GST 387 (Guj.)], where release and re-export had been permitted on furnishing 25% of the Customs duty.

Respondent's Arguments

  • The seized goods did not meet essential requirements under the Food Safety Act and related regulations — lacking the Food Safety and Standards logo, licence number, accurate importer details, and Veg/Non-Veg labelling — justifying the seizure.
  • The petitioner's own applications dated 04.06.2022 and 01.07.2022 seeking provisional release had expressed an inability to furnish the bank guarantee required to safeguard Customs' interest.
  • The Zip Zap Exim decision relied upon by the petitioner was distinguishable, being based on different facts (including value of goods), whereas the present case involved serious alleged breaches of Food Safety Standards.

Court Order / Findings

  • The Court declined to grant the re-export part of the relief at this stage, since the goods had already been intercepted en route (near Sanand) rather than at the port, and expressed no opinion on the petitioner's re-export claim, leaving it open for the petitioner to pursue through appropriate legal recourse.
  • On the prayer for provisional release, the Court held that the Zip Zap Exim precedent could not be mechanically applied given the distinguishable facts and the serious Food Safety Standards non-compliance alleged here, and that Section 110A vests the Customs authorities with discretion to decide provisional release and impose appropriate conditions.
  • Rather than itself directing release, the Court held it proper that the petitioner's pending applications for provisional release (dated 04.06.2022 and 01.07.2022) be decided by the competent Customs authority under Section 110A, which would determine the conditions (including security) for such release.
  • The Court directed the competent Customs authority to decide the pending provisional-release applications, imposing appropriate conditions, within one week, expressly declining to express any opinion on the merits of the seizure or the nature of conditions to be imposed.

Important Clarification

This order does not itself release the seized goods or decide the underlying Food Safety Standards violation allegations — it simply directs the Customs authority to promptly decide the pending provisional-release application under Section 110A of the Customs Act, on whatever conditions the authority considers appropriate. It is a Customs/FSSAI compliance matter and has no connection to GST law.

Sections Involved

  • Sections 110, 110A, 111 and 115, Customs Act, 1962 — Seizure, provisional release, and confiscation
  • Food Safety and Standards Act, 2006, Food Safety Standard Rules, 2011, and Food Safety and Standard (Import) Regulation, 2017

Decision – In Favour of

The petition was disposed of with a direction to the Customs authority to decide the pending provisional-release application within one week, without the Court itself ruling on the merits of the seizure or granting outright release or re-export — a procedural, not substantive, outcome.

Case Details

  • Court: High Court of Gujarat at Ahmedabad
  • Case No.: R/Special Civil Application No. 16714 of 2022
  • Coram: Hon'ble Mr. Justice N.V. Anjaria and Hon'ble Mr. Justice Bhargav D. Karia
  • Date of Order: 19 September 2022

Link to Download the Order

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