Here’s what happens to electronics and gold seized by customs officers

RBI mint at Fort Mumbai. File pic

A recent disclosure from the Rummaging and Intelligence (R&I) wing of Mumbai Customs has unveiled a staggering amount of seized goods, valued at Rs 127.13 crore, currently stockpiled in the customs warehouse in Mumbai. This revelation was brought to light through a comprehensive response to a Right to Information (RTI) request filed by this reporter.

Gold

Among the seized goods, a significant portion comprises gold, with a haul worth Rs 22.35 crore as of April 30, 2024. However, according to the present market rate, the same amount of gold stands at a value of approximately Rs 23 crore. Further scrutiny of the disclosed data reveals that the R&I wing recorded a total seizure of Rs 33.82 crore in 2022, followed by Rs 30.73 crore in 2023.

Additionally, the inventory of seized gold in the customs warehouse is equally alarming, totalling Rs 2234.25 lakh, which amounts to Rs 2288.42 lakh according to current gold market prices. A detailed breakdown indicates that as of December 31, 2023, a substantial amount of gold, totalling 89.529 kg, was stored in the warehouse with a recorded book value of Rs 26,16,03,000. Recalculating the value based on the current gold rate reveals an amount of Rs 55,81,64,074.05.

SOPs for seized gold

The Ministry of Finance has mandated that seized gold be sold to the Reserve Bank of India (RBI) through the Security Printing and Minting Corporation of India Limited (SPMCIL). SPMCIL will collect, transport, and convert the gold into standard bars at one of its three India Government Mints (IG Mint) facilities. Customs Commissionerates will hand over the gold to SPMCIL, ensuring evidentiary value is maintained through witnessed handovers, videography, and documentation. SPMCIL will deliver the gold bars to RBI, which will credit the government account. This process ensures a secure and transparent disposal of seized gold.

Electronics

The value of electronics stored by R&I in the customs warehouse is Rs 957.49 lakh as of April 30, 2024. Since the make and model of electronics seized by the customs R&I wing vary widely, including laptops of various companies, mobile phones of various brands, and other items, there is no accurate way of finding the current value of the seized electronic goods stored in the warehouse.

SOPs for seized electronics

According to Mumbai Customs officials, "The seized electronics are usually auctioned in lots. The process is conducted either every quarter or a half-year basis, based on the seized goods." According to previous press releases from Mumbai Customs, "The goods are offered for sale on an ‘as is where is basis' and ‘what is there basis' without any guarantee as regards to quantity, quality, and other physical parameters, including required NOC, if any. Bidders are advised to inspect the lot carefully before bidding, and customs is not responsible for any discrepancy regarding goods noticed at the time of delivery."

"Only those bidders registered with the GST authority and have a valid registration number can participate in the auction, and post-auction payments are to be done via either Demand Draft or Postal Money Order," disclosed officials of Mumbai Customs.

Process of seized gold disposal

>> Intimation to SMPCIL
>> Collection of gold by SMPCIL, transportation to India government mints
>> Preliminary assessment, melting/minting into standard gold bars, final assessment
>> Delivery of standard gold bars to RBI
>> Payment by RBI through crediting into the government account