2021 (2) TMI 19 - AT - Customs

Seeking provisional release of container - Since appellants found the conditions of provisional release to harsh, they requested the concerned authorities to allow the goods to be exported without insisting on the conditions of Bank Guarantee or to reduce the amount of bank guarantee - HELD THAT - Nearly fifteen months have elapsed since the issue of the investigation report on 18.10.2019, and matter has not still been adjudicated, when appellant has waived the requirements of Show Cause Notice and Personal Hearing. Can there be any explanation for such a delay in the adjudication proceedings, total failure of supervisory control to get the proceedings completed. Had the matter been adjudicated within time the entire litigation which went even before the Hon ble High Court could have been avoided. Urgency shown by the appellant by waiving the requirement of show cause notice and personal hearing, is being used a defence by the revenue for not having followed the procedure prescribed by the Section 110 of Customs Act, 1962. In view of the clarification Vide Circular No 01/2011-Customs dated 4th January 2011, there cannot be much justification for the delay in the issue of provisional release order vide the communication dated 13.06.2019, nearly two months after completion of examination of the goods and drawing of representative samples. Let the things be as they are we are not in position to find any reason for the enormous delay in handling of the goods which were cleared for export and subsequently called back. Also we are unable to find any reason for this delay when the revenue itself contends the outflow of the drawback, ROSL and IGST Refund. Do these delays not hamper the interest of the revenue itself - in view the failure on the part of revenue to complete the proceedings early within the prescribed time frame has not only affected the interests of the exporters, but has also impacted the revenue interests - In case revenue is not in position to complete the entire proceedings within one month time, then they should allow the provisional release of the detained export goods immediately within a week from the date of receipt of this order, on execution of the bond equivalent to the value of the goods and security in form of Bank Guarantee of ₹ 20,00,000/-. Detention and demurrage charges - HELD THAT - These charges should be waived and proper certificate in this regards be issued by the concerned authorities. Appeal disposed off.

Summary

Issues Involved:

1. Jurisdiction of Commissioner Customs Nhava Sheva over exported goods.
2. Validity of provisional release order under Section 110A of the Customs Act, 1962.
3. Conditions imposed for provisional release, including bond and bank guarantee amounts.
4. Delay in adjudication and its impact on exporters and revenue.
5. Waiver of Show Cause Notice and Personal Hearing by appellants.
6. Detention and demurrage charges on detained goods.

Issue-Wise Detailed Analysis:

1. Jurisdiction of Commissioner Customs Nhava Sheva Over Exported Goods:
The appellants argued that the Commissioner Customs Nhava Sheva had no jurisdiction over goods that had already sailed for export, and the recall of the goods from the foreign port was beyond his territorial jurisdiction as per Notification No 82/2017-Cus (NT) dated 24.08.2017. They cited the case of Noble Asset Co Ltd to support their claim.

2. Validity of Provisional Release Order Under Section 110A of the Customs Act, 1962:
The appellants contended that no seizure memo as per Section 110 of the Customs Act, 1962, had been served upon them, making the order for provisional release under Section 110A invalid and without application of mind. They cited A S Enterprises to support their argument.

3. Conditions Imposed for Provisional Release, Including Bond and Bank Guarantee Amounts:
The appellants found the conditions for provisional release, including a bond amount of ?6,40,08,137 and a bank guarantee of ?75,00,000, to be harsh and arbitrary. They argued that they had only availed benefits of ?12,85,606 under the Customs Act, 1962. They requested a reduction in the bank guarantee amount, citing various cases where goods were released on bond execution without any bank guarantee.

4. Delay in Adjudication and Its Impact on Exporters and Revenue:
The tribunal noted that nearly fifteen months had elapsed since the investigation report was issued, and the matter had not been adjudicated despite the appellants waiving the requirement of a Show Cause Notice and Personal Hearing. The tribunal criticized the revenue for the delay, stating that it had affected both the interests of the exporters and the revenue.

5. Waiver of Show Cause Notice and Personal Hearing by Appellants:
The appellants had waived the requirement of a Show Cause Notice and Personal Hearing to expedite the release of their goods. However, the tribunal noted that this waiver was used by the revenue as a defense for not following the prescribed procedure, leading to significant delays.

6. Detention and Demurrage Charges on Detained Goods:
The appellants argued that they should not be subjected to demurrage and detention charges due to the department's failure to take timely action. The tribunal agreed, noting that the revenue had admitted the goods were detained by them and that these charges should be waived. The tribunal directed the concerned authorities to issue a proper certificate for the waiver of these charges.

Conclusion:
The tribunal directed the revenue to finalize the proceedings and adjudicate the matter within one month from the date of the order. If the revenue could not complete the proceedings within this timeframe, they were to allow the provisional release of the detained goods within a week on execution of a bond equivalent to the value of the goods and a bank guarantee of ?20,00,000. The tribunal also directed the waiver of detention and demurrage charges and the issuance of a proper certificate for the same.