2012 (4) TMI 59 - HC - Customs

Differential duty - Writ petition for a Mandamus directing the respondents to release the goods namely 42.260 kilograms of Slack Wax imported vide Bill of Entry No.5526310 dated 21.12.2011 on the value declared by the petitioner at USD 16, 904.00 - the claim of the petitioner is that they had imported 42.260 kilograms of Slack Wax from M/s.Baykim Chemicals Turkey vide invoice No.70221 dated 19.08.2011 - While examining the claim of the petitioner for provisional release it is to be seen what are all the circumstances under which the import was done and thereafter the value so declared by the petitioner is a matter to be taken into account - The only reason for non releasing of the goods is that the petitioner has undervalued the goods at USD 400 per MT. Now the Directorate of Revenue Intelligence Thoothukudi on investigation found that the value of goods is USD 1058 per MT - the goods in question is not a prohibitory item under the provisions of the Act and having regard to the foregoing reasons and discussions and considering the circumstances of the case provisional release of the goods is ordered with reasonable conditions.

Summary

Issues:
Petitioner seeks Mandamus for goods release at declared value. Allegation of undervaluation by respondents. Discrepancy in value assessment. Request for provisional release due to potential harm to goods. Dispute over duty payment and bond requirements. Legal provisions for provisional duty assessment and release of seized goods.

Analysis:
1. Mandamus for Goods Release:
- Petitioner imported Slack Wax, declared value at USD 16,904.00, but respondents allege undervaluation.
- Petitioner seeks Mandamus for immediate release to prevent prejudice due to goods' perishable nature.

2. Value Discrepancy and Undervaluation Allegation:
- Respondents claim actual value of Slack Wax is USD 1058 per MT, while petitioner declared USD 400 per MT.
- Directorate of Revenue Intelligence suggests duty payment of Rs.6,14,323/- and Bank Guarantee for Rs.10.62 lakhs.

3. Provisional Release Request:
- Petitioner argues for provisional release under Customs Regulations, citing Slack Wax as freely importable.
- Respondents demand duty payment and bond to safeguard revenue pending investigation and adjudication.

4. Legal Precedents and Supreme Court Decision:
- Petitioner cites Supreme Court and High Court rulings for provisional release with bank guarantee or partial duty payment.
- Respondents emphasize duty payment and bond requirements to protect departmental interests.

5. Customs Regulations and Provisional Duty Assessment:
- Notification No.81/2011-Customs (N.T.) outlines conditions for provisional duty assessment.
- Section 110(A) of Customs Act allows provisional release of seized goods pending adjudication.

6. Judicial Decision and Conditions for Release:
- Court orders provisional release with conditions: duty payment at declared value, 50% of differential duty, and personal bond for remaining 50%.
- Emphasizes completion of investigation and adjudication process without hindrance to departmental proceedings.

7. Conclusion:
- Writ petition disposed with directions for provisional release under specified conditions.
- Petitioner to cooperate with investigation and adjudication, ensuring no obstruction to departmental processes.
- No costs awarded, and connected miscellaneous petition closed.