The Delhi High Court has held that the customs department cannot hold seized gold indefinitely, orders release to Iranian passengers.
The bench of Justice Prathiba M. Singh and Justice Shail Jain directed the unconditional release of an Iranian passenger’s gold chain that was seized more than three years ago by the Customs Department at the Indira Gandhi International Airport, citing a clear violation of the statutory time limit for issuing a show-cause notice under the Customs Act, 1962.
The petitioner, Mohammad Ali Barazandeh arrived in New Delhi from Iran on April 30, 2022, when Customs officials intercepted him at the airport and seized his gold chain. The seizure was documented under a detention receipt dated the same day. The gold chain was later appraised by the Customs Department on May 30, 2022.
Despite the passage of over three years, the Customs authorities failed to issue a show-cause notice or grant a personal hearing to the petitioner—both of which are mandatory procedural steps under Section 110 of the Customs Act, 1962.
Aggrieved by this inaction, Mr. Barazandeh approached the Delhi High Court seeking the unconditional release of his gold chain.
During the hearing, the petitioner’s counsel relied on the Supreme Court’s recent decision in Union of India & Anr. v. Jatin Ahuja. The apex court had affirmed that if the Customs Department fails to issue a show-cause notice within the statutory six-month period—extendable by another six months with written reasons—the seized goods must be returned to the person from whom they were taken.
Quoting from the Jatin Ahuja judgment, Justice Singh observed that the law does not permit indefinite retention of seized property. The statutory timelines under Section 110(2) of the Act are mandatory, and the absence of a timely notice leads to the automatic dissolution of the seizure.
On the previous hearing held on September 23, 2025, the Court had directed the Customs Department to clarify whether any show-cause notice had been issued. During the final hearing, Ms. Narain confirmed that no notice had been issued to the petitioner.
This admission sealed the case in the petitioner’s favor. The Court noted that the failure to act within the prescribed time frame made continued detention of the gold chain legally untenable.
Citing the Supreme Court’s ruling and consistent High Court precedents, the bench ordered the release of the petitioner’s gold chain. However, since Mr. Barazandeh expressed willingness to re-export the gold to Iran, the Court permitted the release specifically for re-export purposes, subject to payment of warehousing charges applicable from the date of detention.
To ensure procedural compliance, the Court also instructed the Customs Department to complete appraisement of the gold chain before release (if not already done). The petitioner to appear via video conferencing at the time of release. The gold chain to be handed over to the authorized representative upon verification of identity.
Case Details
Case Title: Mohammad Ali Barazandeh Versus The Commissioner Of Custom & Ors.
Case No.: W.P.(C) 14749/2025
Date: 08/10/2025
Counsel For Petitioner: Mohammed Ather
Counsel For Respondent: Anushree Narain
