2014 (6) TMI 825 - AT - Central Excise

Confiscation of goods - provisional release of the seized goods in the factory premises - Execution of bank guarantee - Held that - Finished goods which are ready for dispatch are goods which are meant for export as well as for home clearance. As regards the raw material, we do find that the Commissioner (Appeals) has recorded that most of the raw material is procured against advance licences. Needless to say that when the goods are procured against advance licences, they are secured by way of bond to the Customs authorities. To that extent, Revenue s interest seems to be secured. Even if the raw materials which, according to the Revenue, are unaccounted, the said raw materials having been recorded as stock available with the assessee, can be accounted for, subsequently in records and consumption can be watched. We agree with the view of the ld. Commissioner (Appeals) that the order of releasing the goods on executing the bond backed by a bank guarantee shall not come in the way of investigation which is being carried out by the Department and they may do so. - the bank guarantee should be executed for Rs.20 lakhs. - goods to be released provisionally - Decided conditionally in favour of assessee.

Summary

Issues:
Provisional release of seized goods, Appeal against provisional release, Bank guarantee amount, Investigation in progress.

Analysis:
The judgment pertains to an application by the Revenue for out-of-turn hearing of a Stay Petition against an Order-in-Appeal. The Tribunal allowed the application and took up the Stay Petition for disposal after hearing both sides. The issue revolved around the provisional release of seized goods in the factory premises of the appellant. The Additional Commissioner provisionally released the goods with specific conditions, leading to an appeal by the appellants against the order. The first appellate authority upheld the need for a bond but reduced the bank guarantee amount. The Revenue contended that the appeal against the provisional release was not maintainable, citing a Tribunal decision. However, the appellant argued that appeals against provisional release were permissible based on another Tribunal decision and High Court rulings.

The Tribunal focused solely on the issue of provisional release of goods and decided to dispose of the Stay Petition and proceed with the appeal itself. Both sides presented arguments regarding the provisional release and the case merits. However, the Tribunal refrained from delving into the case merits due to the ongoing investigation. The records indicated that the issue primarily concerned the release of raw materials and finished goods seized under a panchnama. The Tribunal noted that most raw materials were procured against advance licenses, ensuring Customs authorities' security interest. The Commissioner's decision to release goods on executing a bond with a bank guarantee was deemed appropriate and not hindering the ongoing investigation.

In the given circumstances, the Tribunal upheld the Commissioner's order for a full-value bond but reduced the bank guarantee amount. The appellant had already furnished a partial bank guarantee, and the Revenue agreed to accept it for the remaining amount. Upon execution of the bank guarantee for the balance, the Revenue authorities would provisionally release the goods after proper accounting. The appeal was disposed of accordingly, and the order was pronounced in court for further action.