2020 (3) TMI 859 - HC - Customs

Provisional release of seized goods - Gold - Section 110 (A) of the Customs Act, 1962 - HELD THAT - The petitioner had sent a representation claiming provisional release under Section 110 (A) of the Customs Act, 1962. Under Section 110 (A) of the Customs Act, 1962, the goods which were seized can be released provisionally provided a bond is executed by the person, from whom the goods were seized. It must however be kept in mind that penalty has to be decided during the adjudication process. During the adjudication process, the adjudicating authority has to take a further decision whether to provisionally release the seized goods or not - The learned counsel for the petitioner stated that the adjudication process under Section 125 of the Customs Act, 1962 and Section 110 (A) of the Customs Act and independent of the adjudication process and since it has been specifically indicated in the said statute, the petitioner can claim provisional release of goods on providing necessary bond on payment of duty and penalty. The penalty can be decided only during the adjudication process. The adjudicating authorities should be permitted to exercise their discretion in manner known to law. While exercising their discretion, they may also examine the statements made by the petitioner. Naturally, they would have to provide an opportunity to the petitioner of being heard. When the adjudicating authority is empowered even to reject provisional release of goods, unless such orders are passed by the adjudicating authority, this Court should not interfere with such process. The respondent/Adjudicating Authority has to take a decision to provisionally release the goods. The Adjudicating Authority may complete the adjudicating process on or before 30.04.2020 and may give an opportunity of personal hearing to the petitioner, if he so requires - Petition dismissed.

Summary

Issues:
- Provisional release of seized gold under Section 110 (A) of the Customs Act, 1962 pending adjudication process.

Analysis:
1. The writ petition sought mandamus to direct the Joint Commissioner of Customs to provisionally release gold seized under Section 110 (A) pending adjudication. The petitioner, found with unfinished gold chains, relied on a previous judgment allowing release upon depositing 50% of duty. The petitioner was willing to comply and provide necessary undertakings.

2. The petitioner's counsel argued based on the previous judgment's reasoning, emphasizing readiness to pay 50% of the seized property's value as per Section 110 (A) requirements. However, the respondent's counsel objected, citing another judgment stating goods cannot be released until after adjudication under Sections 111 (d) and 111 (1) of the Customs Act, 1962.

3. The respondent's counsel referred to a Division Bench judgment granting discretion to deny provisional release of seized goods, supported by a relevant circular. They argued that the adjudicating authority must decide on release after completing the adjudication process, as per legal provisions and court precedents.

4. The court considered both arguments and noted the petitioner's possession of seized gold chains and the claim for provisional release under Section 110 (A). It highlighted the need for executing a bond for provisional release, with penalties to be decided during adjudication.

5. The court acknowledged the petitioner's argument that Section 125 and Section 110 (A) processes are independent, allowing for provisional release upon fulfilling statutory requirements. It emphasized respecting the adjudicating authority's discretion in deciding on release, as per legal provisions and court judgments.

6. Ultimately, the court dismissed the writ petition, instructing the Adjudicating Authority to decide on provisional release by completing the adjudication process by a specified date and providing a hearing opportunity to the petitioner if requested. No costs were awarded in the judgment.