IQRAR ALI vs. COMMISSIONER OF CUSTOMS

W.P.(C)-111/2026HC Delhi02 September 202613 pages
AI SummaryDismissed

What were the facts?

The Petitioner, Iqar Ali, arrived at Indira Gandhi International Airport, New Delhi, from Jeddah on 26.02.2025 and opted for the Green Channel. Customs authorities intercepted him and recovered nine gold bars and one gold chain, weighing approximately 172 grams, from his baggage. The goods were detained on 26.02.2025. The Respondent claims the Petitioner made a statement under Section 108 of the Customs Act, 1962, admitting he was carrying the undeclared gold and was aware of customs duty, and that he waived the requirement of a Show Cause Notice and personal hearing. The Petitioner instituted a writ petition on 01.12.2025, challenging the continued detention as the original six-month period for issuing a Show Cause Notice under Section 110(2) had expired without one. The Respondent obtained an extension of six months for issuing the notice on 20.08.2025, which would expire on 25.02.2026. A Show Cause Notice was subsequently issued on 23.02.2026.

What did the High Court hold?

The High Court held that the Petitioner is not entitled to the release of the detained goods. The Court noted that the writ petition was instituted before the issuance of the Show Cause Notice, but during the pendency of the petition, a Show Cause Notice was issued on 23.02.2026, which was within the extended period of six months granted under the proviso to Section 110(2) of the Customs Act, 1962. The extended period was to expire on 25.02.2026. Therefore, the principal basis of the Petitioner's claim for release of goods, which was the expiry of the original six-month period without a Show Cause Notice, no longer survived. The Court found the reliance on Jatin Ahuja (supra) misplaced, as that judgment considered the power of extension under Section 110(2) and did not lay down that goods are automatically released upon expiry of the initial period despite a valid extension. Similarly, the decision in Ms. Shubhangi Gupta (supra) was distinguished as it dealt with a situation where no Show Cause Notice was issued at all. In the present case, a written Show Cause Notice was issued within the extended period. Consequently, the Court deemed it unnecessary to examine the validity of the purported waiver or the allegations regarding the recording of the Petitioner's statement under Section 108. The Petitioner was granted liberty to raise all permissible objections in the adjudicatory proceedings pursuant to the Show Cause Notice. The Court clarified that its judgment did not express an opinion on the merits of the allegations or the validity of the statement. The petition was dismissed.

What were the issues?

1. Whether the Petitioner is entitled to the release of the detained gold on the ground that the statutory requirement of issuing a Show Cause Notice under Section 124 of the Customs Act, 1962, was not complied with within the original period prescribed under Section 110(2) of the Act. Assessee's Contentions: - The continued detention of the goods is contrary to the statutory scheme of the Act as the original six-month period for issuing a Show Cause Notice expired without one. - The extension of the period for issuing the Show Cause Notice granted on 20.08.2025 is unsustainable as the reasons recorded (Petitioner's non-appearance for appraisement and expiry of statutory period) do not show sufficient application of mind or cause. - The Petitioner was not duly informed of the extension. - Reliance on the Supreme Court judgment in Union of India & Ors. v. Jatin Ahuja, Civil Appeal No. 3489/2024, to argue that the time prescribed under Section 110(2) is mandatory and goods are liable to be returned upon failure to issue a notice. - The Respondent cannot rely on the purported waiver of the Show Cause Notice or personal hearing in the Section 108 statement, as there is no provision in the Act permitting waiver of Section 124 requirements. Reliance on this Court's judgment in Ms. Shubhangi Gupta v. Commissioner of Customs & Ors., W.P.(C) 10772/2024. - Disputed the genuineness and voluntariness of the Section 108 statement, alleging signatures were obtained on pre-written or blank papers. Revenue's Contentions: - The Petitioner waived the requirement of a Show Cause Notice and personal hearing in his statement recorded under Section 108 of the Act. - A Show Cause Notice was subsequently issued within the extended period prescribed under Section 110(2) of the Act.

Which sections of the Income-tax Act were involved?

Section 124,Section 110(2),Section 108,Section 111(d),Section 111(j),Section 111(l),Section 111(m),Section 111(o),Section 112(a),Section 112(b),Section 114AA

AI-generated summary — verify with the full judgment below

W.P.(C) 111/2026 $~ * IN THE HIGH COURT OF DELHI AT NEW DELHI %

Judgment reserved on: 19.08.2026 Judgment pronounced on: 02.09.2026

Judgment uploaded on: 02.09.2026 # CNR No. DLHC010001232026 + W.P.(C) 111/2026

IQRAR ALI

.....Petitioner Through: Dr. Ashutosh, Ms. Fatima, Mr. Rohit Swarup, Mr. Dalip Singh, Mr. Avinash Kumar Singh, Mr. Pravej Hasan, Mr. Abhijeet Sagar, Mr. S.Vijaykanth, Advs.

versus

COMMISSIONER OF CUSTOMS

.....Respondent Through: Sh. Atul Tripathi, SSC-CBIC Mr. Akshay Sagar and Mr. Shubham Mishra, Advs.

CORAM: HON'BLE MR. JUSTICE ANIL KSHETARPAL HON'BLE MS. JUSTICE SHAIL JAIN J U D G M E N T ANIL KSHETARPAL, J.:

1.

The principal issue which arises for consideration in the present Petition is whether the Petitioner is entitled to seek release of the gold detained by the Customs authorities on the ground that the statutory requirement of issuance of a Show Cause Notice under Section 124 of the Customs Act, 1962

The order continues below.

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