Karnataka High Court Sets Aside Customs Order Over Non-Consideration Of Request For WhatsApp Evidence

The Karnataka High Court has set aside a Customs adjudication order concerning the seizure of undeclared foreign currency, observing that the authorities failed to consider the noticee's request for copies of WhatsApp messages and screenshots relied upon by the investigation.

It held that the Customs authorities must first examine whether the noticee is entitled to receive the electronic records along with the certificate required under Section 138C of the Customs Act, 1962, before proceeding further with the adjudication.

Justice B.M. Shyam Prasad was hearing a writ petition filed by three individuals challenging an Order-in-Original dated February 28, 2026, passed by the Customs authorities in proceedings arising from the recovery of foreign currency from one of them while he was scheduled to travel from Bengaluru to Bangkok.

The petitioners had challenged the show cause notice dated April 22, 2024, the consequential adjudication order and the recovery notices issued by the Customs Department.

During the adjudication proceedings, the petitioners had submitted a reply dated September 11, 2025, specifically raising an objection that the WhatsApp messages and screenshots referred to in the show cause notice had not been furnished to them.

They contended that the electronic records had neither been included in the list of relied-upon documents nor accompanied by a certificate under Section 138C of the Customs Act.

The petitioners argued that the non-supply of these documents had prejudiced their defence and denied them an effective opportunity to contest the allegations.

The Customs authorities, however, proceeded to confirm the show cause notice, recording that the noticees had not submitted any written reply and had failed to appear for personal hearings despite multiple opportunities being granted.

The adjudicating authority also concluded that the petitioners had failed to establish that the seized foreign currency had been acquired through authorised channels under the Foreign Exchange Management Act or that it had been brought into India following foreign travel.

Before the High Court, the petitioners specifically challenged the adjudication order on the ground that their reply dated September 11, 2025, had not been considered.

The High Court found merit in the contention that the request for copies of the WhatsApp messages and the accompanying certificate required consideration by the adjudicating authority.

The Court noted the Revenue's submission that the reply had not been handed over during the personal hearing and had instead been sent through email. However, it observed that the reply had specifically raised the issue of non-supply of the electronic records relied upon by the investigation.

"This Court finds some force in the submissions by Sri Aravind V. Chavan that the reply is not considered because it is not handed over during the personal hearing or immediately after the service of Show Cause Notice but is sent by e-mail, but the underlying salient is that the petitioner's reply has been sent by e-mail making the point that the petitioner is entitled to be served with copies of WhatsApp messages/screen shots along with the Certificate as contemplated under Section 138C of the Customs Act...", it said.

The bench observed that the question of whether the petitioners were required to be furnished with the WhatsApp messages and screenshots, along with the certificate contemplated under Section 138C of the Customs Act, had to be examined by the adjudicating authority.

The Court further observed that the issue should be decided at this stage so that the proceedings do not fail at a later stage on technical grounds.

Accordingly, the High Court partly allowed the writ petition and quashed the Order-in-Original, remitting the proceedings to the adjudicating authority for reconsideration.

The petitioners were directed to appear before the third respondent on November 30, 2026, along with a certified copy of the High Court's order and a copy of their reply dated September 11, 2025.

The adjudicating authority was directed to first hear the petitioners and decide whether they were required to be furnished with the WhatsApp messages and screenshots along with the certificate under Section 138C of the Customs Act.

For Petitioners: Advocate Haaris Moosa, 

For Respondents: Advocate Aravind V. Chavan