The Madras High Court has ordered the Customs Department to verifythe origin certificate for an arecanut consignmentwithin 30 days after the shipments have been held up for over six months.

Disposing of a writ petition filed by an importer, Justice Senthilkumar Ramamoorthy directed the Commissioner of Customs, Chennai, to conclude the verification within 30 days of receiving a copy of the court order, recognising the limited shelf life of the commodity.

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Radha Industries of New Delhi imported arecanuts from Sri Lanka under Bill of Entry dated June 24, 2023. The importer claimed exemption from Customs duty under the India-Sri Lanka Free Trade Agreement. For purposes of availing of such exemption, a certificate of origin is required to be produced, and the importer produced such certificate of origin from the Department of Commerce of Sri Lanka.

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High Commission refusal

The petitioner said onerous conditions were imposed when the goods were provisionally assessed on the alleged ground that the certificate of origin may not be genuine.

The petitioner informed the court that the certificate of origin includes a QR code on it. When a request was made for the issuance of a verification certificate, the Sri Lankan High Commission refused to do so by pointing out that the QR code can be verified in real time.

R Hemalatha, senior standing counsel for the Commissioner of Customs, submitted to the court that the Directorate of Revenue Intelligence (DRI) had noticed that certificates of origin in relation to imports from Sri Lanka were being fabricated. Consequently, it was decided that such certificates of origin would be subject to scrutiny before the relevant goods are cleared for home consumption.

The order said there is nothing to indicate that the petitioner indulged in manipulation of the certificate of origin relating to the present Bill of Entry or any other Bill of Entry. It should be recognised that arecanuts have a limited shelf life and the risk of contamination and deterioration of goods increases over time.

Subject to food safety law

“By taking into consideration the revenue interest in ensuring that duty exemption is not availed of, except in genuine cases, and the petitioner’s concern that the goods be cleared expeditiously, an appropriate balance should be struck. In my view, this can be achieved if the respondents are directed to complete the verification process expeditiously and by enabling clearance against a bond if verification is not completed within the specified time limit,” the judge said.

“If the certificate is found to be genuine upon such verification, the goods shall be released without insisting on payment of duty. On the other hand, if the certificate is found to be not genuine, it is open to the respondents to take further action in accordance with law,” the order said.

“If the verification is not completed within the above mentioned period of 30 days, the petitioner would be entitled to provisional release of the goods on providing a bond for 100 per cent of the value of goods but without insisting on a bank guarantee,” it said.

“The release of the goods shall, in all situations, be subject to approval by the relevant food safety authorities,” the order said.

Sources in Campco said the shelf life of arecanut is one year provided the arecanut quality complies to the standards laid down by FSSAI (Food Safety and Standards Authority of India) that the moisture content is 7-8 per cent.

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