2018 (11) TMI 1696 - AT - Customs

Provisional Release of seized goods - disproportionate harsh conditions for release of disputed goods - HELD THAT - In the instant case, the seized goods were ordered to be provisionally released on certain conditions which, according to Learned Counsel for the appellant, are unduly harsh considering that the goods are not permitted to be cleared for home consumption. The offer of provisional release was, therefore, not taken advantage of and the goods continue to be under seizure. It is admitted that the show cause notice was issued on 12th May 2017 which is well beyond the extended period prescribed in section 110 of Customs Act, 1962. The operation of section 110(2) of Customs Act, 1962 does not stand in the way of procedure initiated by issue of the show cause notice nor does it concern itself with the issue of a show cause notice at any time thereafter. The letter of the Maharashtra Pollution Control Board dated 12th April 2017 in the show cause notice is surprisingly not referred to in the communication dated 18th April 2017. Though it is stated that the Pollution Control Board has recommended that the goods may be subject to destruction by recycling, the letter of the Maharashtra State Pollution Control Board is not appended as evidence. We are, in consequence, not in a position to comprehend the circumstances in which a recommendation was offered by the Pollution Control Board. Considering the said recommendation which necessarily casts the responsibility for such destruction on the Government of India, it cannot but be appropriate for the plea of re-export to be an effective alternative without such burden. The conditions for release of the goods is set aside - the appellant shall forthwith re-export the goods - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Contesting harsh conditions for release of disputed goods.
2. Failure to issue show cause notice within specified time.
3. Interpretation of Customs Act, 1962 regarding provisional release and show cause notice timelines.
4. Applicability of precedents in similar cases.
5. Request for unconditional release of goods for re-export.
6. Lack of response from Pollution Control Board and recommendation for destruction of goods.

Analysis:
1. The appeal challenged the imposition of harsh conditions for the release of goods imported against eight bills of entry seized in January 2015. The appellant argued that the conditions were disproportionate considering the nature of the goods, 'micro SD cards', found defective and subject to hazardous waste rules.
2. The appellant contended that the seizure should be lifted due to the failure to issue a show cause notice within the time specified in section 110(2) of the Customs Act, 1962. Reference was made to relevant instructions and decisions from various High Courts to support this argument.
3. The Tribunal analyzed the provisions of the Customs Act, 1962 regarding the issuance of show cause notices and provisional release orders. It distinguished between situations where goods are provisionally released and where no such order is passed, emphasizing the impact on the timeline for issuing show cause notices.
4. Precedents from different High Courts were cited to support arguments related to the interpretation of relevant legal provisions and the applicability of timelines for issuing show cause notices in cases of seized goods.
5. The appellant sought unconditional release of the goods for re-export, highlighting the delay in responses from the Pollution Control Board and the recommendation for destruction of the goods. The Tribunal considered these factors in determining the appropriate course of action.
6. Due to the lack of clarity regarding the Pollution Control Board's recommendation and the burden it imposed, the Tribunal set aside the conditions for release of the goods and allowed the appeal to that extent, with the condition that the goods be re-exported promptly.

Overall, the Tribunal's decision addressed the legal issues raised by the appellant comprehensively, considering the provisions of the Customs Act, relevant precedents, and the specific circumstances of the case, ultimately granting relief by setting aside the release conditions and allowing for re-export of the goods.