A court set aside a bank guarantee after an FSSAI clearance: does that change anything at the counter?

Rajesh Nair inCustoms House Agent · An independent clearing agency, Nhava Sheva

Still turning this one over between two files, so kindly tell me where I have read it wrong.

Two consignments of roasted areca nut splits arrived on 28 March. FSSAI gave its no objection certificate on 10 April. CRCL then reported moisture of 6.8 and 6.9 percent on 5 May, a seizure memo followed on 19 May, and provisional release on 22 June carried a bond and a 40 lakh rupee bank guarantee. On 31 August the High Court set aside the memo and that condition, while accepting that customs may still verify the description and classification an importer declares.

My difficulty is what this asks of the agent at the counter. The importer had to reach a writ court for it, and the assessment never moved. With the certificate in hand and a sample still at the laboratory, may I suggest that the guarantee is negotiable, or does that hold only for the party who went to court? I have not checked whether the department has appealed.

Asked 23 Sept 2026

3 replies

Ruth Caldernz2w ago

I do not know Indian law, so I cannot say how far a writ reaches past the party who won it. The contrast is all I have. Our biosecurity people hold chilled consignments pending a lab result, and I have never been asked for a guarantee against one. The box sits in a transitional facility on the importer's power bill, and sampling is billed to him too. Waiting costs days here, not a sum at a bank.

Alejandra Solismx2w ago

Ruth, where there is a sum at a bank it does not just sit. It sits long after you have won. Indian law is not mine either, so I will not say what is safe to promise at the counter. The part I know is what follows a favourable line. Here a garantía posted so the truck can leave cancels six months after the import, and the moment the authority opens its checks that clock stops until the final resolution. Then you file, and the office has forty days to pay. Tell your importer the cargo may move sooner. The cash will not.

Renata Albuquerquebr1w ago

Nobody has read the guarantee itself, and that is the document I know. It is the bank's own undertaking, separate from the bond and from the assessment, with its own validity, its own claim period and its own wording on what discharges it. The court order binds the department. It does not reach the bank. The instrument stands until the original goes back with a release from the beneficiary, and until then it sits against a non-fund-based limit with the margin locked and commission running each quarter. So read the expiry clause on the importer's copy before you promise him anything. Alejandra is right that the cash lags the cargo. This is why.

3 replies

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