2010 (4) TMI 651 - HC - Customs

Release the bank guarantee - Commissioner of Customs (Appeals), directed the lower authority to get the samples tested and return the bank guarantee Customs Authorities found no time to respond and neglect to give reply to letters of assessee Held that - respondent had failed and neglected to give reply to the letters requesting to retest the goods and for return of the bank guarantee as directed by the Commissioner of Customs (Appeals) and as the revisional application under Section 129DD of the Act filed out - respondents are directed to retest the goods and to return the bank guarantee - petition is allowed

Summary

Issues:
1. Compliance with directions of the appellate authority regarding retesting of samples and return of bank guarantee.
2. Filing of revisional application under Section 129DD of the Customs Act, 1962 beyond the statutory period.
3. Request for condonation of delay in filing the revisional application.
4. Failure of customs authorities to respond to requests for compliance.
5. Legality of the actions taken by the Assistant Commissioner of Customs regarding the bank guarantee.

Issue 1: Compliance with Directions of the Appellate Authority
The petitioners, a company under the Companies Act, 1956, and one of its directors, sought a direction for customs authorities to act as per the Order-in-Appeal passed by the Commissioner of Customs (Appeals). The appellate authority had directed retesting of samples and return of the bank guarantee. Despite repeated requests from the petitioners, the customs authorities did not respond to comply with the appellate authority's directions. The High Court held that the failure of the customs authorities to respond and take necessary actions was unjustifiable. The Court directed the respondents to retest the goods and return the bank guarantee to the concerned bank, emphasizing that the legality of the revisional application and condonation of delay would be determined by the Revisional Authorities.

Issue 2: Filing of Revisional Application Beyond Statutory Period
The Department filed a revisional application under Section 129DD of the Customs Act, 1962 after the statutory period had expired. The petitioners argued that unless the application for condonation of delay was allowed, the revisional application could not be considered valid. Citing legal precedents, the Court clarified that the mere filing of a revisional application did not automatically stay the original order. The Court emphasized that the application for condonation of delay needed to be regularized before the revisional application could be deemed in order. The Court set aside the actions of the Assistant Commissioner of Customs regarding the bank guarantee, highlighting the importance of adhering to statutory timelines and procedural requirements.

Issue 3: Request for Condonation of Delay
The Department's revisional application was filed beyond the statutory period, prompting the need for a request for condonation of delay. The Court noted that the application for condonation of delay was pending before the appropriate authority and emphasized that until a decision was made on this request, the revisional application could not be considered valid. The Court referred to legal judgments to support the principle that the mere filing of a revisional application did not automatically suspend the original order, underscoring the importance of procedural compliance in legal proceedings.

Issue 4: Failure of Customs Authorities to Respond
The petitioners had sent multiple letters requesting compliance with the appellate authority's directions for retesting samples and returning the bank guarantee. However, the customs authorities did not respond to these requests. The Court deemed this lack of response as unjustifiable and emphasized the obligation of the authorities to act promptly and in accordance with legal directives. The Court directed the respondents to fulfill their obligations regarding retesting of goods and return of the bank guarantee, highlighting the importance of timely and appropriate responses to legal directives.

Issue 5: Legality of Actions Regarding Bank Guarantee
The Assistant Commissioner of Customs had taken actions concerning the bank guarantee, which were challenged in the writ petition. The Court found that the actions of the Assistant Commissioner were not sustainable and therefore set them aside. The Court directed the concerned respondents to retest the goods and return the bank guarantee to the specified bank, with a reminder that the legality of the revisional application and the request for condonation of delay would be determined by the Revisional Authorities. The Court clarified that it had not delved into the merits of these applications, leaving them to be handled in accordance with the law.

In conclusion, the High Court allowed the writ petition, directing the respondents to comply with the appellate authority's directions and return the bank guarantee. The Court emphasized the importance of procedural compliance, timely responses to legal directives, and adherence to statutory timelines in legal proceedings. The judgment highlighted the significance of following due process and respecting the decisions of appellate authorities in matters concerning customs regulations.