2023 (9) TMI 1299 - HC - Customs

Seeking provisional release of goods - dispute related to valuation - silver articles/utensils - Section 110-A of the Customs Act, 1962 - binding effect of orders of the higher authority unless stayed - HELD THAT - The Respondents are not justified in not provisionally releasing the goods which were imported in December, 2021 and are lying with Respondents till today that is for almost one year and nine months. The Respondents have fairly stated that the goods imported are not prohibited goods and the only issue in dispute is with respect to the valuation. There is also no dispute that as of today, there is no stay of the Order-in-Original dated 16th December, 2022, whereby the show cause notice for misdeclaration of the value of the goods was dropped. The Petitioner is justified in relying upon the decisions of the Supreme Court in the case of Union of India 1991 (9) TMI 72 - SUPREME COURT , Collector of Customs, Bombay 1993 (9) TMI 124 - SUPREME COURT , Himgiri Buildcon Industries Limited and Agsons Agencies (I) Private Limited 2021 (2) TMI 391 - BOMBAY HIGH COURT and HLG Trading 2018 (8) TMI 1608 - MADRAS HIGH COURT in support of his contention that orders of the higher authority is binding on lower authorities unless same is stayed. Since, there is no stay as of today, the Order-in-original is binding on the Authorities and therefore the Petitioner is justified in seeking provisional release of the goods under Section 110-A of the Customs Act, 1962. It is important to note that the Respondents have not doubted the credentials of the Petitioner who is a regular importer of such goods. The Petitioner has approached this Court only after receiving no response from the Respondents inspite of several request for provisional release of the goods. The petition is allowed by directing the goods, subject matter of Bill of Entry No. 669283 dated 17th December, 2021, be provisionally released on the Petitioner paying the duty on the value as declared i.e. Rs. 1,01,23,813/- and furnishing a bond containing an undertaking that the Petitioner shall pay the duty fine and/or penalty of the differentiated amount and/or as may be adjudged by the adjudicating authority, subject to the appellate provisions under the Act. The bond and undertaking shall be appropriately furnished.

Summary

Issues involved:
The petition filed under Article 226 of the Constitution of India seeks a writ of mandamus against the Respondents to permit provisional release of imported silver articles/utensils subject to a Bill of Entry, under Section 110-A of the Customs Act, 1962.

Details of the Judgment:
1. The Petitioner, a proprietary concern, imported silver articles/utensils and declared their value for customs duty. A show cause notice was issued alleging misdeclaration of value to evade customs duty.
2. An Order-in-Original dropped the proceedings initiated under the show cause notice, but the Commissioner of Customs proposed to file an appeal against it.
3. The Petitioner requested multiple times for the release of goods pending clearance, citing financial losses, but the Respondents did not release the goods. The petition sought a mandamus for the release.
4. The Petitioner argued that the delay in releasing the goods was affecting business and relied on legal precedents to support the claim for release under Section 110-A of the Customs Act.
5. The Respondents stated that an appeal was pending, and they had requested an early hearing and stay of the Order-in-Original after the petition was filed.
6. The Court found that the Respondents were unjustified in not releasing the goods, as the only issue was valuation, and there was no stay on the Order-in-Original. The Petitioner's reliance on legal decisions was deemed valid.
7. The Respondents did not question the Petitioner's credibility as a regular importer. The Court noted the lack of response from the Respondents to the Petitioner's requests for release.
8. The Court referred to a Circular providing guidelines for provisional release of seized goods under Section 110-A of the Customs Act. It highlighted the duty of Respondents to consider applications for release.
9. The Court criticized Respondent No. 2 for not responding to the Petitioner's repeated requests for release, emphasizing the duty of public officials to act fairly and responsibly.
10. The Court concluded that the Petitioner was entitled to the provisional release of the goods by paying the declared duty value and furnishing a bond. The petition was allowed, and the goods were to be released accordingly.
11. The judgment was issued without costs, and parties were directed to act on the authenticated copy of the order.