The Calcutta High Court has directed the Customs authorities to provisionally release 34,650 kilograms of Assam dried areca nuts that had been seized and subsequently declared by the Food Safety and Standards Authority of India (FSSAI) to be substandard and unsafe for human consumption.
The bench of Justice Smita Das De permitted the release after considering the perishable nature of the seized goods and the delay in completing the adjudication proceedings. The release, however, was made subject to strict financial and traceability safeguards, including the execution of a bond, furnishing of a bank guarantee and an undertaking that the goods would be used exclusively for industrial purposes.
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The dispute concerned 34,650 kilograms of Assam dried areca nuts seized by the authorities on December 30, 2025. FSSAI reportedly found the consignment to be substandard and unsafe for human consumption.
The petitioner approached the High Court seeking provisional release of the goods during the pendency of the Customs adjudication proceedings.
The matter had initially been instituted before the Circuit Bench at Jalpaiguri. It was subsequently transferred to the Principal Bench at Calcutta and renumbered as WPA No. 16759 of 2026.
According to the petitioner, an application seeking provisional release had been submitted to the competent authority on March 17, 2026, but remained pending.
The petitioner argued that the seized goods were perishable and had remained in the authorities’ custody since December 2025.
The continued seizure, despite the pendency of the application for provisional release, was stated to be causing serious prejudice to the petitioner.
To address concerns arising from the FSSAI findings, the petitioner offered to furnish an undertaking that the seized areca nuts would be used exclusively for industrial purposes and would not be diverted for human consumption.
The petitioner relied on the CBIC Circular dated August 16, 2017, which lays down a mechanism for the provisional release of seized imported goods against adequate security.
The Customs department opposed the prayer on the ground that adjudication proceedings concerning the seized consignment were still pending.
It was contended that releasing the goods at that stage could prejudice the interests of the Revenue. The authorities submitted that any provisional release should be strictly governed by the conditions contained in paragraphs 2.1 and 2.2 of the CBIC Circular dated August 16, 2017.
The Customs authorities also sought a condition requiring the goods to be sold in the presence of the concerned departmental officials.
After considering the submissions and examining the record, the High Court held that the petitioner had established a prima facie case warranting interference.
The Court observed that the perishable nature of the goods and the delay in completing the adjudication proceedings were material considerations while deciding the request for provisional release.
The court noted that the CBIC Circular dated August 16, 2017, already provided a settled mechanism for releasing seized imported goods while adequately safeguarding the Revenue’s interests.
Under paragraph 2.1 of the Circular, seized imported goods may be provisionally released upon the owner’s request, subject to the execution of a bond for their full or estimated value.
Paragraph 2.2 additionally requires a bank guarantee or security deposit sufficient to cover the entire duty or differential duty payable on the goods, the possible redemption fine under Section 125 of the Customs Act, 1962, and the penalties that may be imposed during adjudication.
For determining the security against a possible redemption fine, the competent authority is required to consider the nature of the seized goods, the duties and charges payable, their market price and the estimated margin of profit.
The High Court directed the competent authority to provisionally release the seized areca nuts after the petitioner executes a bond in accordance with paragraph 2.1 of the CBIC Circular.
The petitioner was also ordered to furnish a bank guarantee, to the satisfaction of the competent authority, in accordance with paragraph 2.2 of the Circular.
These conditions would ensure that the potential duty liability, redemption fine and penalties remain adequately secured during the pendency of the adjudication proceedings.
The High Court imposed an express restriction on the end use of the seized goods.
The petitioner was directed to submit an undertaking confirming that the areca nuts would be used exclusively for industrial purposes and would not be used or diverted for human consumption.
The petitioner must also provide the authorities with complete details of the purchaser, including identity proof, along with the time and venue at which the seized goods are proposed to be sold.
The disclosure requirement is intended to enable the authorities to track the disposal of the consignment and ensure compliance with the restriction imposed by the Court.
The High Court also expressed concern over the prolonged pendency of the adjudication process.
The Court issued a peremptory direction to the adjudicating authority to complete the entire adjudication process within eight weeks from the date of the order, preferably on or before October 31, 2026.
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