Delhi High Court - Orders
Praveen Khatana vs State Of Nct Of Delhi & Anr on 18 August, 2025
Author: Sanjeev Narula
Bench: Sanjeev Narula
$~23
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ CRL.M.C. 855/2025, CRL.M.A. 3973/2025
PRAVEEN KHATANA .....Petitioner
Through: Mr. Sumit Kumar, Mr. Jogeshwar
Gupta and Mr. Karan P., Advocates.
versus
STATE OF NCT OF DELHI & ANR. .....Respondents
Through: Mr. Sameer Vashisht, SC (Civil) for
GNCTD with Mr. Anand Vardhan
Mishra, Assistant Commissioner
(Excise) in person.
Mr. Swapan Singhal, Advocate for R-
2.
Mr. Mukesh Kumar, APP for State
with Mr. Satish Bhati, SI, PS-Sarita
Vihar.
CORAM:
HON'BLE MR. JUSTICE SANJEEV NARULA
ORDER
% 18.08.2025 CRL.M.A. 19006/2025 (for setting aside order dated 23.06.2025)
1. Mr. Anand Vardhan Mishra, Assistant Commissioner (Excise) is present in Court in compliance with the Court's direction. He is assisted by Mr. Sameer Vashisht, Standing Counsel for GNCTD, who has advanced submissions on his behalf. Certain clarifications are required to be given regarding the impounding of the vehicle by Mr. Mukesh Kumar, APP for State, for which, he seeks a short accommodation.
2. It is noted that in the instant case, 72 half bottles of 'Hoegaarden This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/08/2025 at 21:39:40 Wheat Beer', valued at nearly INR 7,000/-, were being brought in a vehicle by the Petitioner. Since the quantity exceeded the permissible limit under the Delhi Excise Act, 2009, the vehicle was seized and proceedings for confiscation were initiated. A show cause notice was thereafter issued to the Petitioner under Section 59 of the Act. The Petitioner appeared and admitted that the liquor was being carried, albeit claiming it was for a Holi party and not for sale. The Deputy Commissioner (Excise), while considering the matter, directed that the vehicle could be released only upon payment of penalty in terms of Section 57 of the Act, quantified at five times the Insured Declared Value (IDV). The impugned order records as under:
"As per direction of DC (Excise) to apply penalty as per Sec. 57 of the Act for release of vehicle. If the respondent wants to release his vehicle he has to pay 5 times the value of IDV. The respondent informed that he will not be able to pay the penalty. Hence the vehicle is confiscated immediately as per rule."
3. Since the Petitioner expressed his inability to pay the amount equivalent to five times the IDV, the vehicle was confiscated. It is observed that the Assistant Commissioner did not even determine the IDV of the vehicle, yet directed the Petitioner to deposit five times its value. There is no explanation on record as to why the IDV was not ascertained, particularly when the Petitioner asserts that the IDV of the vehicle is approximately INR 10,00,000/-. As a consequence, in terms of the directions of the Deputy Commissioner (Excise), the Petitioner was required to pay nearly INR 50,00,000/- for transporting 72 half bottles of beer valued at about INR 7,000/-.
4. It is unclear as to why the compounding fee envisaged under Section 57 of the Excise Act, is being imported into confiscation proceedings under This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/08/2025 at 21:39:40 Section 59. The statute treats compounding of an offence and confiscation of property as distinct remedies, to be invoked in separate circumstances. However, in the present case, the Deputy Commissioner (Excise) has directed that the vehicle would be released only upon payment of penalty equivalent to five times its IDV, calculated on the lines of Section 57. It is further not evident as to why the penalty has been computed on the basis of the IDV of the vehicle, rather than with reference to the statutory duty or the value of the goods involved.
5. Therefore, in the prima facie opinion of the Court, the action of the State appears grossly arbitrary and is unsupported by any cogent explanation. Mr. Vashisht, on instructions from the Assistant Commissioner (Excise), submits that nearly 4,000 vehicles have been similarly impounded and that action is being contemplated against their owners.
6. In view of the foregoing observations, the Court deems it appropriate to call upon the Commissioner of Excise to file an affidavit within two weeks, furnishing complete particulars of all orders of compounding/confiscation passed under Section 59 of the Excise Act, during the last six months. The Commissioner shall also join the proceedings through video conferencing on the next date of hearing.
7. List on 12th September, 2025.
SANJEEV NARULA, J AUGUST 18, 2025 nk This is a digitally signed order.
The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above. The Order is downloaded from the DHC Server on 25/08/2025 at 21:39:40