2020 (8) TMI 554 - HC - Customs

Provisional Release of goods - 1811 10 LED Television Sets - Section 110-A of the customs Act - provisional release of the goods on the condition that the writ applicant shall furnish a bond of re-determined value, pay the amount of differential duty and submit bank guarantee of 30% of the differential duty. HELD THAT - There is no dispute with regard to the fact that the writ applicant has deposited a sum of ₹ 18 lakh, which is approximately 40% of the amount of differential duty assessed. However, despite the deposit of ₹ 18 lakh, the officer of the DRI declined to release the goods. It appears that the goods came to be seized way back in the year 2018. The amount towards the differential duty is to the tune of ₹ 48,80,647/-. The amount to be recovered towards the differential dues is to the tune of ₹ 48,80,647/-. The writ applicant has already deposited ₹ 18 lakh with the competent authority being 40% of the differential duty. We need to secure the balance amount so as to protect the interest of the Revenue. The goods are lying with the respondents Nos.3 and 4 past almost two years. In such circumstances, we direct the writ applicant to furnish an indemnity bond of the balance amount of ₹ 30,80,647/-. The indemnity bond shall be furnished to the Assistant Commissioner of Customs, Surat. The Assistant Commissioner of Customs, Surat shall inform about such furnishing of indemnity bond to the Commissioner of Customs (Imports), State of Maharashtra. Upon receipt of the intimation of the furnishing of the indemnity bond, the Commissioner of Customs (Imports) of the State of Maharashtra shall, at the earliest, communicate to the respondent No.4 to release the goods in favour of the writ applicant. The indemnity bond of the amount of ₹ 30,80,647/- shall be furnished before the respondent No.4 - the Assistant Commissioner of Customs, Surat within a period of eight days from today. Application disposed off.

Summary

Issues:
Challenge to order of provisional release of goods with severe conditions under Section 110-A of the Customs Act.

Analysis:
The writ applicant sought relief to quash the order dated 24th June 2019 by the Commissioner of Customs, challenging the conditions imposed for the provisional release of LED Television sets. The conditions included furnishing a bond of re-determined value, paying the differential duty, and submitting a bank guarantee of 30% of the differential duty. The petitioner argued that these conditions were severe, unreasonable, and contrary to Section 110-A of the Customs Act, which allows release on bond submission with reasonable conditions. The petitioner faced losses as goods remained seized since November 2018, despite depositing a substantial amount towards the differential duty.

The petitioner, through their counsel, expressed readiness to furnish an indemnity bond for the balance amount of the differential duty. The court noted the goods were in possession of the Senior Intelligence Officer, Directorate of Revenue Intelligence, Surat. The standing counsel for the Union of India highlighted the adjudicating authority as the Principal Additional Director General in Maharashtra, creating difficulty in immediate release upon bond submission.

The court directed the writ applicant to furnish an indemnity bond of the balance amount within eight days to the Assistant Commissioner of Customs, Surat. Upon receipt, the Assistant Commissioner would inform the Commissioner of Customs (Imports), Maharashtra, who would then instruct the release of goods. The court mandated completion of this process within four weeks, thereby disposing of the writ application.