2014 (9) TMI 799 - HC - Customs

Invocation of bank guarantee - Confiscation of goods - Held that - Bank guarantee was given to release the goods. The petitioner has no case that bank guarantee was invoked before releasing the goods. The Customs Department have released the goods, after furnishing bank guarantee. In view of the order passed by the Commissioner of Customs, the petitioner has no case that CESTAT was pleased to stay the recovery pending statutory appeal. When it is made out that CESTAT has not stayed the order passed by the Customs Department, the petitioner cannot be heard to say that the second respondent erred in invoking the bank guarantee - Decided against assessee.

Summary

Issues:
1. Invocation of bank guarantee by Assistant Commissioner of Customs.
2. Duty payable and penalty imposed on the petitioner.
3. Detention of goods by Customs Department.
4. Compliance with court order regarding bank guarantee.
5. Lack of stay on executable order by CESTAT.

Analysis:
1. The petitioner, an exporter of knitted garments, challenged the invocation of the bank guarantee by the Assistant Commissioner of Customs. The bank guarantee was furnished following a court order in response to a previous case. The petitioner had placed an order for a machine and faced investigation for misdeclaration by the Directorate of Revenue Intelligence.

2. The Joint Commissioner of Customs had earlier determined the duty payable by the petitioner and imposed a penalty, which was challenged through appeals. Despite a favorable decision by CESTAT, the Commissioner of Appeals passed the same order, leading to further appeals by the petitioner.

3. The goods meant for export were detained by the Customs Department, prompting the petitioner to seek relief through a writ petition. The High Court directed the petitioner to provide a bank guarantee for the release of goods, which was complied with. However, the Assistant Commissioner of Customs invoked the bank guarantee subsequently.

4. The court noted that the bank guarantee was provided to secure the release of goods and that there was no stay on the pending executable order against the petitioner. Despite the petitioner's compliance with the court's directive, the lack of a stay by CESTAT on the Customs Department's order allowed for the invocation of the bank guarantee.

5. Ultimately, the court dismissed the writ petition, stating that the petitioner's contentions lacked merit. The lack of a stay on the Customs Department's order by CESTAT meant that the Assistant Commissioner of Customs was justified in invoking the bank guarantee. The dismissal of the petition was accompanied by the rejection of connected miscellaneous petitions.