2016 (8) TMI 1529 - HC - Customs

Seeking release of goods - allegation is that revenue/customs authority had not issued show cause notice under the Customs Act within the mandatory time limit - HELD THAT - The operative portion of the judgment is SAI INCORPORATION VERSUS THE PRINCIPAL COMMISSIONER OF CUSTOMS (IMPORT) ANR. 2016 (6) TMI 350 - DELHI HIGH COURT is unequivocal and clarifies that all statutory options and discretion vested with the customs authorities are available to them including the option to proceed under Section 124(3). In the circumstances, the only finding of the Court was the failure to issue show cause notice within the time stipulated by law meaning that the goods were to be unconditionally released. There was no question of the revenue, therefore, from being precluded from using its power to bring to assessment the entire quantum, and classifying them for the purposes of customs duty or seeking to recover the correct amount due. The impugned order of 16-6-2016 is hereby set aside. It is open to the respondents to proceed in accordance with law and assess the entire quantum, both in respect of their correct classification as well as pass any orders of penalty and/or confiscation - Petition disposed off.

Issues:
1. Compliance with court orders for release of seized goods.
2. Alleged reassessment of goods without issuing show cause notice.
3. Failure to comply with court directions by customs authorities.
4. Explanation sought from Deputy Commissioner for non-compliance.
5. Contempt petition filed by petitioner.
6. Multiplicity of proceedings and compliance with court orders.
7. Setting aside the impugned order and directing compliance with the law.

Comprehensive Analysis:

Issue 1: Compliance with court orders for release of seized goods
The High Court, in its judgment dated 2-6-2016, directed the unconditional release of seized goods to the petitioner within a specified time frame. Despite this order, the goods were not released, prompting the petitioner to file a writ petition. The Court reiterated the previous order and directed immediate compliance by the customs department for the release of the goods.

Issue 2: Alleged reassessment of goods without issuing show cause notice
The Deputy Commissioner of Customs unilaterally reassessed the goods without issuing a show cause notice to the petitioner, contrary to the court's explicit direction for unconditional release. The court found this action unlawful and directed the Deputy Commissioner to explain the basis for re-assessment and comply with the previous order for release.

Issue 3: Failure to comply with court directions by customs authorities
The customs authorities failed to comply with the court's order for unconditional release of the seized goods within the specified time frame. The court expressed dissatisfaction with the non-compliance and directed immediate release of the goods to the petitioner, emphasizing the need for adherence to court orders.

Issue 4: Explanation sought from Deputy Commissioner for non-compliance
The Deputy Commissioner failed to comply with the court's order for release and unilaterally reassessed the goods. The court directed the Deputy Commissioner to provide a detailed explanation for his actions and comply with the court's directive for unconditional release of the goods.

Issue 5: Contempt petition filed by petitioner
The petitioner filed a contempt petition due to the non-compliance of the court's order for release of the goods. The court acknowledged the petitioner's concerns and directed immediate compliance with the previous orders, emphasizing the importance of adhering to judicial directives.

Issue 6: Multiplicity of proceedings and compliance with court orders
The court noted the unnecessary multiplicity of proceedings arising from the customs department's failure to comply with the court's order. Emphasizing the need for adherence to judicial decisions, the court directed the customs department to release the goods unconditionally and cooperate with the petitioner in any future proceedings.

Issue 7: Setting aside the impugned order and directing compliance with the law
The court set aside the impugned order of reassessment and directed the customs authorities to proceed in accordance with the law. The court clarified that all statutory options were available to the customs authorities, including assessing the entire quantum of goods and imposing penalties as per the Customs Act, 1962.

In conclusion, the High Court's judgment emphasized the importance of compliance with court orders, adherence to legal procedures, and the need for customs authorities to act in accordance with the law while respecting judicial directives.

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