Quick answer: In Pranavbhai Ambalal Patel v. Additional Director General, Directorate of Revenue Intelligence, Ahmedabad & Ors., decided on 25 August 2026, a Division Bench of the Gujarat High Court (A.S. Supehia and Vaibhavi D. Nanavati, JJ.) directed the release of an imported car that the Directorate of Revenue Intelligence (DRI) had held under a bare panchnama for more than a year without passing any order under Section 110(1) of the Customs Act, 1962. The Court held that “detention” of goods under a panchnama, without a distinct order recording reasons to believe that the goods are liable to confiscation, is not the same as “seizure,” and that the department cannot let a detention run indefinitely and then start the Section 110(2) limitation clock — six months, extendable by a further six under the first proviso — only from the date it finally gets around to issuing a formal seizure memo. Because no valid seizure order existed within the statutory period measured from the actual detention, the subsequent show-cause notice under Section 124(a) read with Section 28(4) fell outside limitation, the car had to be released, and the department’s own conditions for provisional release — resting on a circular paragraph already struck down by the Delhi High Court — were held illegal as well.
Key Takeaways
- A panchnama recording that goods should not be removed or dealt with is not, by itself, a valid seizure under Section 110(1) of the Customs Act, 1962. The proper officer must pass a separate order — a seizure memo or equivalent — recording reasons to believe that the goods are liable to confiscation, and that obligation applies with equal force where the officer instead invokes the first or second proviso to Section 110(1) because it is not practicable to physically remove or seize the goods.
- The six-month period in Section 110(2) (extendable by a further six months under the first proviso) runs from the date goods are actually detained, not from the date the department eventually issues a formal seizure order. A department cannot manufacture extra time by delaying the seizure memo itself.
- A pending writ petition is not, without more, an excuse for departmental inaction. The Court found on its own record that it had never restrained the DRI from investigating or from passing an order under Section 110, and treated the department’s contrary representation to the Supreme Court as unsupported by the case’s actual history.
- Conditions imposed for provisional release under Section 110A cannot rest on a circular paragraph that has already been struck down elsewhere. The Court held the provisional release order illegal because it applied paragraph 2 of Circular No. 35/2017-Customs, which the Delhi High Court had set aside in Shanus Impex v. Union of India.
- Importers facing prolonged detention without a seizure order, or a seizure order and show-cause notice engineered to arrive just inside limitation, now have a reasoned Gujarat High Court authority — reinforced by the Supreme Court’s own ratio in Jatin Ahuja — to seek immediate release, and potentially costs, rather than waiting out the adjudication.
1. Introduction
Every customs seizure carries a clock. Section 110(2) of the Customs Act, 1962 gives the department six months from the seizure of goods to issue a show-cause notice proposing confiscation under Section 124(a); miss that window, extendable by a further six months for recorded reasons under the first proviso, and the goods must be returned. That structure only functions, however, if “seizure” has a fixed, identifiable start date. What happens when the department detains goods through nothing more than a panchnama — a witnessed record of what officers found and directed on the spot — without ever passing the distinct order Section 110(1) contemplates, and then issues a formal seizure memo only after the detention has already run for a year, timing the show-cause notice to fall just inside the limitation measured from that late memo?
That is precisely what happened to a car imported from Japan and detained by the Directorate of Revenue Intelligence (DRI) at Ahmedabad. The Gujarat High Court’s answer, in Pranavbhai Ambalal Patel v. Additional Director General, DRI, is that the department does not get to choose when its own clock starts. Detention without a recorded order under Section 110(1) is not seizure; the limitation period runs from the point of actual detention; and a department that lets that period lapse cannot revive it by the simple expedient of declining to pass a seizure order until it is tactically convenient to do so. The judgment also had to deal with a subsidiary but pointed finding: that the DRI’s own explanation to the Supreme Court for its delay — blaming the pendency of the writ petition — was contradicted by the High Court’s own record. This article sets out the facts, the Court’s reasoning on both the detention-versus-seizure question and the provisional release conditions, and what the ruling means for importers and their advisers dealing with prolonged customs detentions.
2. Case summary and background
The petitioner purchased a Toyota Land Cruiser from Japan for USD 54,000 on 13 December 2024, shipped against a Sea Waybill/Bill of Lading on 23 December 2024. A Bill of Entry, No. 7472252, was filed on 26 December 2024, declaring an assessable value of USD 54,000. The car was given out-of-charge on 2 January 2025 after assessment and examination — meaning customs clearance had already been completed in the ordinary course. The petitioner paid stamp duty of Rs. 14,621 on 30 December 2024 and the applicable customs duty of Rs. 99,78,795 on 31 December 2024, and had the vehicle insured; only the registration number remained pending.
On 7 February 2025, the DRI searched the petitioner’s residential premises, prepared a panchnama, and directed him not to deal with the car pending inquiry. Summonses followed on 14 February, 3 March and 21 March 2025; the petitioner supplied documents and an explanation on 4 April 2025, and then filed the present writ petition. A Coordinate Bench, by order dated 18 September 2025, directed the respondent officers to take the vehicle into safe custody pending the petition and to conduct a thorough investigation, recording the Senior Standing Counsel’s statement that an investigation report would follow by 9 October 2025. Successive orders — 9 October, 6 November, 27 November and 18 December 2025 — record the investigation still incomplete, with the department repeatedly assuring the Court that it would finish. The investigation was ultimately completed only on 8 May 2026.
In the interim, the petitioner challenged the orders of 18 September and 9 October 2025 before the Supreme Court by way of Special Leave Petition (Civil) No. 12431 of 2026. The Supreme Court disposed of that petition by order dated 10 April 2026, recording a statement by the Additional Solicitor General that the pendency of the writ petition before the High Court had prevented the department from initiating proceedings under Section 110, and that there was, in fact, no seizure on record. Noting that the car was a perishable commodity, the Supreme Court directed the department to act promptly, while keeping open the question of the legality and validity of the detention itself.
Only after that order — on 17 April 2026, more than fourteen months after the panchnama, and over a year since the detention began — did the DRI issue a seizure memo under Section 110(1). A show-cause notice under Section 124 read with Section 28(4) of the Act followed on 8 May 2026, timed so as to fall within six months of that seizure memo. A provisional release order dated 18 May 2026 then permitted release of the vehicle only on execution of a bond for the assessable value of Rs. 85,95,860 and a bank guarantee of Rs. 1,20,00,000 to cover potential differential duty, fine and penalty — conditions the order derived from paragraph 2 of Circular No. 35/2017-Customs dated 16 August 2017.
Before the High Court, the petitioner argued that the year-long delay in issuing a seizure order meant the limitation under Section 110(2) had already run from the date of actual detention, relying on the Supreme Court’s decision in Union of India v. Jatin Ahuja and on Delhi and Punjab & Haryana High Court authority distinguishing detention from seizure. The department, through its Senior Standing Counsel, did not seriously contest the underlying facts, instead leaving the terms of release to the Court’s discretion and pointing out that the investigation was now complete. The Court, examining its own record, found that it had at no stage restrained the DRI from proceeding under Section 110, and that the department’s representation to the Supreme Court to the contrary was unsupported.
3. Legal analysis
3.1 What Section 110 actually requires
Section 110(1) of the Customs Act, 1962 empowers the “proper officer” to seize goods where he has “reason to believe” they are liable to confiscation. Two provisos qualify that power: where it is not practicable to remove, transport, store or take physical possession of the goods, the officer may instead give custody of the goods to the owner or another person on an executed undertaking not to deal with them without permission; and where it is not practicable to seize the goods at all, the officer may serve an order to the same effect. Section 110(2) then supplies the limitation: where goods are seized under sub-section (1) and no notice is given under Section 124(a) within six months of the seizure, the goods must be returned to the person from whom they were seized — a period the Principal Commissioner or Commissioner may, by the first proviso, extend by a further six months for reasons recorded in writing, communicated to the affected person before the original period expires.
The Act does not itself define “detention” or “seizure,” and the Court turned to the ordinary meaning of “detention” — the act of keeping back or withholding a person or thing — to characterise what had actually happened to the petitioner’s car: a panchnama directing him not to deal with the vehicle, with no order passed under either proviso to Section 110(1). The department, the Court noted, never claimed that the car fell within the category of goods covered by the first proviso (impracticable to remove or store); if anything, the second proviso — impracticable to seize at all, so an order restraining dealing with the goods issues instead — was the applicable route, and no such order had been passed either. What existed was only the panchnama.
Relying at length on the Delhi High Court’s reasoning in Worldline Tradex Pvt. Ltd. v. Commissioner of Customs (Import), the Gujarat High Court held that a panchnama recording that a custodian was told not to remove or deal with goods is not equivalent to an order under the proviso to Section 110(1); no action was taken in terms of that proviso, and it is “imperative” that where a proper officer decides to seize goods, reasons to believe that they are liable to confiscation must be recorded first. The Court also drew on Punjab & Haryana High Court authority in Mapsa Tapes Pvt. Ltd. v. Union of India and Om Udyog v. Union of India, both holding that a valid seizure requires the proper officer to record reasons to believe under Section 110(1) before or at the point of seizure, and that the department cannot rely merely on the existence of the power to seize without showing a prima facie case for confiscation. The Court’s own earlier decision in Baboo Ram Hari Chand v. Union of India was cited for the proposition that treating a panchnama itself as a seizure order is “unheard of,” and that the burden lies on the department to justify any rush to seize rather than proceed by lesser means.
3.2 The limitation clock runs from actual detention, not from the department’s convenience
Having established that the panchnama of 7 February 2025 amounted to a detention without a valid Section 110(1) order, the Court confronted the department’s evident strategy: wait out the writ petition, let the Supreme Court dispose of the SLP on terms recording that pendency of the petition had blocked action, and only then issue a seizure memo — dated 17 April 2026 — timed so that the show-cause notice of 8 May 2026 would fall within six months of that memo, comfortably inside limitation as measured from that late starting point. The Court declined to let that sequencing succeed. It held that where goods are detained without any order under the provisos to Section 110(1), the limitation period nonetheless begins to run from the date of actual detention — here, 7 February 2025, reinforced by the DRI’s own summonses to the petitioner on 14 February and 3 March 2025 under Section 108 of the Act. Applying the Supreme Court’s ratio in Jatin Ahuja — that where goods are seized under Section 110(1) and no Section 124(a) notice issues within six months, extendable by a further six under the first proviso, the consequence is release of the goods — the Court concluded that by the time the seizure memo was finally issued in April 2026, well over a year after the panchnama, both the original six-month period and the maximum extended period of one year under Section 110(2) had already been consumed. The proper officer, the Court held, “cannot be allowed to reap the fruits of its inaction”: a customs authority cannot indefinitely detain goods in the guise of “detention” while avoiding the order that would start the statutory clock, and then benefit from its own delay by measuring limitation from a seizure order it chose to postpone.
The Court also addressed, and rejected, the department’s account of why the seizure order and notice had come so late. Reviewing its own record of orders dated 18 September 2025, 9 October 2025, 6 November 2025, 27 November 2025 and 18 December 2025, the Bench found that it had at every stage directed the DRI to complete its investigation, never restrained proceedings under Section 110, and had recorded the petitioner’s own cooperation. The representation made to the Supreme Court — that the pendency of the writ petition had prevented the department from initiating Section 110 proceedings, and that there was no seizure on record — was, the Court found, a “bald statement” unsupported by anything the DRI had raised before the High Court itself, where no such objection had ever been made.
3.3 Provisional release conditions built on a struck-down circular
A second, narrower issue concerned the terms on which the vehicle had provisionally been released on 18 May 2026 — a bond for the assessable value of Rs. 85,95,860 and a bank guarantee of Rs. 1,20,00,000. Those conditions were traced to paragraph 2 of Circular No. 35/2017-Customs dated 16 August 2017, which the Delhi High Court had already set aside in Shanus Impex v. Union of India, 2024 (388) E.L.T. 78 (Del.), to the extent it curtailed the adjudicating authority’s discretion in fixing release conditions. The Gujarat High Court held that the department’s continued reliance on a circular paragraph already struck down was “contumacious” and “strongly deprecated,” and set aside the provisional release order on that basis as well, directing unconditional release of the vehicle instead.
3.4 What the judgment does not decide
The Court’s order is confined to the specific detention-to-seizure sequence before it and does not purport to hold that every panchnama is incapable, in any circumstances, of embodying the substance of a Section 110(1) order — its holding is that this particular panchnama, and this particular department, failed to record the reasons to believe or pass the order the provisos require. Nor does the judgment address the merits of the underlying confiscation proceedings or any liability the petitioner may face under the show-cause notice for undervaluation or any other ground; the Court expressly limited itself to the legality of the detention and the provisional release conditions, leaving any substantive adjudication to proceed — though on the Court’s own reasoning, a fresh notice would now have to reckon with a limitation period that has already run.
4. Practical significance
For importers whose goods, vehicles or other property are detained by the DRI or customs field formations on the strength of a panchnama alone, this judgment supplies a concrete basis for demanding either a formal seizure order, with reasons recorded, within the statutory period, or the return of the goods. Where a department delays issuing that order for months, counsel should track the limitation period from the date of actual detention — not from whenever a seizure memo eventually appears — and be prepared to argue, as here, that the department cannot extend its own time by inaction. The distinction between the two provisos to Section 110(1) also matters in practice: if goods cannot practicably be seized, the officer must serve an order to that effect, and the absence of any such order, coupled with a mere panchnama, leaves the detention without statutory foundation from day one.
Practitioners should also treat provisional release conditions with independent scrutiny rather than accepting them as a fait accompli. Where a department invokes Circular No. 35/2017-Customs or a similarly rigid formula for bonds and bank guarantees, counsel should check whether the relevant paragraph has been judicially set aside elsewhere, since a release order built on a struck-down circular is itself vulnerable to challenge, as it was here. More generally, where a department represents to a superior court that a pending writ petition has prevented it from acting, the petitioner’s counsel should be ready to produce the High Court’s own order sheets — as happened in this case — since a court asked to accept such a representation at face value may not otherwise be aware that its own record contradicts it.
Finally, this decision is a reminder that CBEC’s own Instruction No. 1/2017-Cus., dated 8 February 2017 — issued precisely to stop field formations from treating a panchnama as a substitute for a seizure order — remains current departmental policy, not merely case law imposed from outside. Compliance teams within customs brokerage and import operations should treat any detention lasting beyond a matter of weeks without a formal seizure memo as a red flag warranting an immediate representation, rather than waiting for adjudication to run its course.
The costs award of Rs. 10,000 imposed on the respondents, though modest, signals that a Court confronted with a demonstrably inaccurate account of its own record is prepared to mark that conduct rather than pass over it in silence. For litigation strategy, this suggests that where a department’s representation to a higher forum can be tested against the lower court’s own order sheets, a petitioner should place that record squarely before the court rather than treating the department’s account as beyond challenge merely because it was made to the Supreme Court. Choice of remedy also matters here: a writ petition remains the appropriate route to challenge the legality of a detention or seizure as such, since the statutory appellate hierarchy under the Customs Act is designed to review an adjudication order on merits, not to test whether the pre-adjudication seizure itself was ever validly effected.
5. Conclusion
The Gujarat High Court’s decision in Pranavbhai Ambalal Patel does not break new statutory ground so much as it refuses to let a department’s own delay rewrite where a well-established limitation clock starts. Detention by panchnama, without the order Section 110(1) requires, is not seizure; the six-month period under Section 110(2) — extendable, at most, to a year — runs from actual detention; and a department that manufactures a late seizure memo to reset that clock gains nothing by it. The judgment’s treatment of the provisional release conditions, and its pointed rejection of the DRI’s account of its own delay, reinforce the same underlying theme: the burden of showing that due process was followed rests on the department, not the importer.
For a body of customs litigation in which detention without formal seizure is a recurring departmental tactic, this decision — squarely following the Supreme Court’s ratio in Jatin Ahuja and aligning Gujarat with Delhi and Punjab & Haryana authority on the same point — gives importers a clear, reasoned template for seeking release rather than waiting out a prolonged and legally unfounded detention. Nothing in the reasoning depends on the goods being a motor vehicle; the same analysis applies equally to any consignment detained by a panchnama and left without a Section 110(1) order, whether at the hands of the DRI or any other customs formation, which is what gives this otherwise fact-specific dispute a significance well beyond the single car it concerned.
Authorities
Applied by the Court
| Authority | Citation | Proposition |
|---|---|---|
| Union of India v. Jatin Ahuja | (2025) 36 Centax 301 (SC) | Where goods are seized under Section 110(1) and no Section 124(a) notice issues within six months (extendable by a further six months under the first proviso to Section 110(2)), the consequence is release of the seized goods to the person from whom they were seized. |
| Worldline Tradex Pvt. Ltd. v. Commissioner of Customs (Import) | 2016 (340) ELT 174 (Del.) | A panchnama directing a custodian not to remove or deal with goods is not an order under the proviso to Section 110(1); detention cannot be treated as seizure absent a recorded order and reasons to believe. |
| Mapsa Tapes Pvt. Ltd. v. Union of India | Punjab & Haryana High Court | A valid seizure requires the proper officer to record reasons to believe, under Section 110(1), that the goods are liable to confiscation; failure to do so vitiates the seizure. |
| Om Udyog v. Union of India | Punjab & Haryana High Court | The department must show a prima facie case for exercising confiscation powers, not merely rely on the existence of the power; goods directed to be released in its absence. |
| Baboo Ram Hari Chand v. Union of India | Gujarat High Court | A panchnama cannot itself be treated as a seizure order; such a “composite order” is unheard of, and the burden lies on the department to justify a rush to seizure. |
| Shanus Impex v. Union of India | 2024 (388) E.L.T. 78 (Del.) | Paragraph 2 of Circular No. 35/2017-Customs, dated 16 August 2017, set aside to the extent it curtails the adjudicating authority’s discretion in fixing provisional release conditions. |
| Instruction No. 1/2017-Cus. | F. No. 591/04/2016-Cus. (AS), dated 8 February 2017 | Field formations must pass a distinct seizure order (in addition to any panchnama), recording reasons to believe, whenever goods are seized; the Section 110(2) limitation period runs irrespective of whether goods remain seized or are provisionally released. |
Cited within the quoted extract of Worldline Tradex, but distinguished rather than applied
| Authority | Note |
|---|---|
| R.S. Seth Gopikisan Agarwal (Supreme Court) | Concerned Section 105 (search), not Section 110 (seizure); the Delhi High Court in Worldline Tradex distinguished it as not dispensing with the need for recorded reasons even under Section 105. |
| S.J. Fabrics Pvt. Ltd. v. Union of India | Distinguished in Worldline Tradex as addressed only to computation of the limitation period for a Section 124(a) notice, not to whether an order is required for a Section 110(1) seizure. |
Legislation considered
| Statute | Provisions | Source |
|---|---|---|
| Customs Act, 1962 | Sections 28(4), 105, 108, 110, 110A, 124 | https://www.indiacode.nic.in/handle/123456789/2028 |
| Circular No. 35/2017-Customs | Dated 16 August 2017, paragraph 2 | Referenced as struck down in part by Shanus Impex |
Judgment
Pranavbhai Ambalal Patel S/o Shri Ambalal Patel v. Additional Director General, Directorate of Revenue Intelligence, Ahmedabad & Ors., R/Special Civil Application No. 6295 of 2025, High Court of Gujarat at Ahmedabad (A.S. Supehia and Vaibhavi D. Nanavati, JJ.), decided 25 August 2026 — https://indiankanoon.org/doc/93177359/
FAQ
Does a panchnama ever amount to a valid seizure under the Customs Act? Not by itself. The Gujarat High Court held that a panchnama recording that goods should not be removed or dealt with is, at most, a detention. A valid seizure under Section 110(1) requires a distinct order in which the proper officer records reasons to believe that the goods are liable to confiscation, or, where seizure is impracticable, an order under the second proviso to the same effect.
From when does the Section 110(2) limitation period run if the department delays issuing a seizure order? From the date the goods are actually detained, not from whenever the department eventually issues a formal seizure memo. A department that lets a detention run for over a year before passing a seizure order cannot measure the six-month (or extended one-year) limitation period from that late order.
Can provisional release conditions be challenged if they rely on a departmental circular? Yes, where the specific circular paragraph relied upon has already been judicially set aside. Here, the provisional release conditions were held illegal because they rested on paragraph 2 of Circular No. 35/2017-Customs, which the Delhi High Court had struck down in Shanus Impex v. Union of India.
This article is not legal advice and does not create an attorney–client relationship. Readers should verify the certified copy of the judgment and any subsequent clarificatory orders before relying on it, and consult a qualified advocate on the facts of their matter.