Export Held Up Due To Conflicting Lab Reports: Delhi High Court Asks Customs To Decide Pan Masala Exporter's Plea
The Delhi High Court has asked the Customs authorities to consider releasing the bank guarantee of a city-based pan masala exporter, forfeited after conflicting lab reports about adulteration of its export products with tobacco.A division bench of Justices Prathiba M. Singh and Shail Jain observed that when no objections were found in the first lab test report (CRCL), “the circumstances...
The Delhi High Court has asked the Customs authorities to consider releasing the bank guarantee of a city-based pan masala exporter, forfeited after conflicting lab reports about adulteration of its export products with tobacco.
A division bench of Justices Prathiba M. Singh and Shail Jain observed that when no objections were found in the first lab test report (CRCL), “the circumstances which warranted the issuance of the second CRCL report are completely unknown and it does not specify as to why the same were issued.”
For context, Petitioner is an exporter engaged in the export of various Tobacco products including Pan Masala, etc. It had filed shipping bills for export of goods described as Mouth Fresheners, Pan Masala RG and Tobacco T. However, an alert was issued, due to which its goods were only released on a provisional basis.
At the time of provisional release of the goods, certain bank guarantees were furnished by the Petitioner. Thereafter, samples of Petitioner's goods were sent to the Finance Ministry's Central Revenues Control Laboratory.
Since there was no objection in the first CRCL reports, the Petitioner sought finalisation of the shipping bills and release of the bank guarantees.
However, the same was declined citing a new CRCL report which found characteristics of Gutka in Petitioner's goods.
Petitioner argued that the second report was prepared without drawing any further samples. It was further contended that the first CRCL reports would be binding and the clarification in the form of second CRCL report would be completely non-tenable.
Agreeing, the High Court held that the Commissioner of Customs must reconsider the matter “in a holistic manner” and it must decide Petitioner's representations for release of bank guarantees expeditiously.
Appearance: Mr. Rahul Raheja , Mr. Rohit Raheja and Mr. Gaurav Prakash, Advs. for Petitioner; Mr. Suhail Malik, SPC Mr. Shaunak Dutta, Adv for Respondents
Case title: M/S Truespices India Inc v. Union Of India & Ors.
Case no.: W.P.(C) 18966/2025