Delhi High Court Orders Customs To Release Padma Bhushan Awardee's Imported Artwork Amidst Dispute Over Valuation

A division bench of Justices Prathiba M. Singh and Shail Jain observed there is no conclusive proof that the artwork was made in Pakistan, as claimed by the Department.

“The bill of entry itself reveals that the import is being effected from Dubai,” it observed.

The Court was dealing with a petition filed by the proprietor of M/s Dhoomimal Art Gallery, which sought to import “The Scarecrow”, created back in 1972.

The artwork was removed from India and the Petitioner now claimed to be importing the same from Dubai, declaring a value of 200 USD (Rs 20,409.56).

However, as per the Customs, the artwork is actually from Pakistan and its value is of Rs.30 lakhs.

The Department accordingly confiscated the artwork under Section 111(m) read with Section 124 of the Customs Act, 1962, and demanded a redemption fine of Rs. 30,000/-, differential duty of Rs 83,23,037/-, and penalty of approximately Rs 85,00,000/-.

Petitioner however contended that if the Customs does not accept the declared value of the goods, it must proceed in accordance with Rule 12 of the Customs Valuation (Determination of Value of imported goods) Rules, 2007.

The provision stipulates that if the proper officer doubts the accuracy of the value declared in relation to any imported goods, he may ask the importer to furnish further information. Further, the proper officer shall intimate the importer in writing the grounds for doubting the accuracy of the value and provide a reasonable opportunity of being heard.

The High Court at the outset observed there is a substantial difference between the valuation given to the present artwork and to earlier artworks of the same artist, which have been sold in the market.

“Thus, prima facie, the amount of Rs.30 lakhs could be a figure which the valuer arrived at on an approximation basis without any concrete evidence to support the same,” it said.

Further considering that the artwork has a potential of being damaged if allowed to continue to lie with the Customs, it ordered the Department to release the same to the art gallery.

However, before finally deciding the dispute, the Court deemed it fit to grant an opportunity to the Customs Department to raise its objection.

As such, it ordered the art gallery to deposit Rs.2 Lakhs with the Department. “The amount of Rs.30,000/- imposed as redemption fee under Section 125 of the Customs Act, 1962, shall also be deposited,” it added.

Appearance: Mr. SatvikVerma, Adv. for Petitioners; Mr. Harpreet Singh, SSC

Case title: Uday Jain & Anr. v. Additional Commissioner Customs Air Cargo And Import & Anr

Citation: 2025 LiveLaw (Del) 1070

Case no.: W.P.(C) 13092/2025

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