2024 (2) TMI 685 - HC - Customs

Imposition of condition of furnishing 100% bank guarantee (on provisional release) - FSSAI has approved the goods for domestic consumption (which was a situation also in respect of the earlier seven consignments) - whether now new condition of a 100% bank guarantee cannot be foisted on the petitioner, if there is no difference whatsoever in the goods which are subject matter of the bills of entries? - HELD THAT - The petitioner is a proprietorship and a small importer, the pattern of imports have also been quite consistent. The goods in question are certainly edible goods which are perishable. The petitioner ought not to have been meted out such discriminatory treatment of denying clearance. Also it is imperative that harsh and unreasonable conditions cannot be imposed and more so when there is not an iota of material on the part of the department, as placed before the Court indicating as to why a different yardstick would be required to be applied to the present consignments when earlier seven consignments were released at 16% to 28% bank guarantee. Respondents are directed to grant provisional release of the goods to the petitioners, subject matter of bills of entry No. 8219403 and 8362251, by accepting the bank guarantee from the petitioner of Rs. 3,49,000/- in respect of the first bill of entry and bank guarantee of Rs. 2,00,000/- in respect of the second bill of entry. Necessary action in that regard be taken within 10 days from today - In addition to the said bank guarantees, the petitioner shall furnish a bond as per the conditions as incorporated in the letter of Assistant Commissioner, of Custom dated 15 November 2023 for the full of the goods which is of Rs. 37,34416/-. Return of the bank guarantee - HELD THAT - The petitioner is at liberty to make a representation to the respondents for return of the bank guarantee which be made within a period of two weeks from today. If such a representation is made the same shall be considered by the designated officer on its merits and in accordance with law and communicate its decision within a period of four week from the submission on such representation. Petition disposed off.

Issues Involved:
1. Detention and provisional release of imported goods.
2. Arbitrary and illegal detention of goods.
3. Bank guarantee requirements for provisional release.
4. Consistency in treatment of similar consignments.
5. Approval from FSSAI and discriminatory treatment.

Summary:

Issue 1: Detention and Provisional Release of Imported Goods

The petitioner, a proprietorship regularly importing "premium cold coffee" from Vietnam, seeks provisional release of two consignments detained by the customs department. The consignments are subject to bills of entry No. 8219403 dated 9 October 2023 and No. 8362251 dated 15 October 2023, with assessable values of Rs. 12,36,082/- and Rs. 24,98,333/- respectively.

Issue 2: Arbitrary and Illegal Detention of Goods

The petitioner contends that the detention of goods is arbitrary and illegal, as seven similar consignments were previously released on provisional assessment between 26 August 2022 and 13 July 2023. The petitioner has already incurred demurrage and detention charges amounting to Rs. 6,00,000/- for the second consignment.

Issue 3: Bank Guarantee Requirements for Provisional Release

The petitioner argues that the department's insistence on a 100% bank guarantee of Rs. 25 Lakh for provisional release is onerous and inconsistent with previous releases, where bank guarantees ranged from 16% to 28%. The petitioner proposes a bank guarantee of Rs. 3,49,000/- for the first bill of entry and Rs. 2,00,000/- for the second, considering the demurrage incurred.

Issue 4: Consistency in Treatment of Similar Consignments

The court notes that the department had previously granted provisional release of similar consignments with varying bank guarantees between 16% and 28%. There is no substantial reason provided by the department for applying a different yardstick to the current consignments.

Issue 5: Approval from FSSAI and Discriminatory Treatment

The petitioner highlights that the goods have been approved for clearance by the FSSAI, similar to the previous consignments. The court finds it unjust to impose new conditions of a 100% bank guarantee without any material difference in the goods.

Judgment:

1. The respondents are directed to grant provisional release of the goods by accepting a bank guarantee of Rs. 3,49,000/- for the first bill of entry and Rs. 2,00,000/- for the second bill of entry within 10 days.
2. The petitioner shall furnish a bond for the full value of the goods, Rs. 37,34,416/-, as per the conditions in the letter dated 15 November 2023.
3. The goods must be released within one week from the furnishing of the bank guarantee and bond.
4. The petitioner may make a representation for the return of the previous bank guarantees, which the respondents must consider and decide upon within four weeks.
5. Rule is made absolute with no costs.

← Previous Next →