Bombay High Court Restores Registration Of Imported Car, Says RTO Cannot Ignore Customs Settlement Commissions' Findings
The Bombay High Court has held that authorities cannot override or ignore the findings of the Customs Settlement Commission while taking administrative action. The Court ruled that once the Commission accepts the disclosure, settles duty liability and grants immunity under Section 127H of the Customs Act, its order becomes final and conclusive under Section 127J, and no other authority...
The Bombay High Court has held that authorities cannot override or ignore the findings of the Customs Settlement Commission while taking administrative action. The Court ruled that once the Commission accepts the disclosure, settles duty liability and grants immunity under Section 127H of the Customs Act, its order becomes final and conclusive under Section 127J, and no other authority can indirectly reopen the customs issue.
A bench of Justice N.J. Jamadar while hearing the writ petition preferred by the purchaser, restored the registration of a Nissan petrol car purchased by Mumbai businessman, whose registration had been cancelled by the RTO on the ground that the vehicle was originally imported using forged customs documents.
The case in hand is that the vehicle had been fraudulently imported by a syndicate using a fake bill of entry filed in the name of a diplomatic officer to evade customs duty. During investigation, the Directorate of Revenue Intelligence (DRI) seized the vehicle and unearthed the forgery.
When the purchaser approached the Customs Settlement Commission, the Commission recorded that the petitioner had no role in the customs fraud, all forged papers were created by the smuggling syndicate, the purchaser had taken normal precautions before buying the car and had made a full and true disclosure, also customs duty, interest, and redemption fine were duly paid.
Accordingly, immunity from prosecution and penalty was granted under Section 127H of the Act.
The RTO cancelled the registration under Section 55(5) of the Motor Vehicles Act, asserting that the vehicle had been registered on the basis of false customs documents. The Appellate Authority upheld the cancellation, prompting the petitioner to seek High Court intervention.
The purchaser preferred a writ petition before the High Court seeking quashing of the RTO's order cancelling the vehicle's registration and restoration of the certificate of registration.
The Bench noted that the Settlement Commission had already held the petitioner to be an innocent purchaser, found no link between him and the evasion, settled customs duty, interest and fine, and granted immunity from penalty and prosecution under Section 127H of the customs Act.
Section 127H gives the Customs Settlement Commission the power to grant immunity from penalty and prosecution to a person who approaches it, makes a full and true disclosure, and settles the customs duty liability.
The Court held that the RTO's decision ignored the statutory consequences of the Settlement Commission's order. Under Section 127J of the Act, every settlement order is conclusive as to the matters stated therein and cannot be reopened in any proceeding under any other law
Applying the doctrine of proportionality, the Bench held that since the entire customs duty liability was already discharged, and the petitioner was not involved in the fraud, cancellation of registration was excessive and unjustified.
In view of the above findings, the Bench allowed the writ petition, quashed the orders passed by the RTO and the Appellate Authority, and directed restoration of the vehicle's registration
Case Title: Imran Humanyun Chandiwala Vs. The State of Maharashtra & Ors.
Case Title: Writ Petition: 12921 of 2025
Appearance of the Petitioner: Mr. Cherag Balsara i/by Mr. Yogesh Patil
Appearance for Respondent/State: Mr. Abhishek Bhadang, AGP for State
Click Here To Read/Download Order