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Interpretation of Section 23(2) of the Customs Act, 1962 regarding the right to relinquish title to imported goods before clearance for home consumption. Analysis: The appeal was against an order demanding customs duty on warehoused goods under Section 72 of the Customs Act, 1962. The appellants had imported chemicals and warehoused them, intending to clear them gradually for home consumption. However, due to operational issues, they sought extensions for clearance but eventually abandoned the goods under Section 23(2) of the Act, relinquishing their title. The authorities demanded duty and interest, rejecting the appellants' contention of the right to abandon the goods. The dispute centered on the interpretation of Section 23(2) and the timing of relinquishing title. The Tribunal analyzed Section 23(2) which allows the owner of imported goods to relinquish title before clearance for home consumption, relieving them from duty payment. The Act defines imported goods as those not yet cleared for home consumption. Warehoused goods remain imported until cleared. The Tribunal noted that in this case, no bill of entry for home consumption was filed, duty was unpaid, and no clearance order was issued. Therefore, the appellants had the unconditional right to abandon the goods under Section 23(2) before clearance order issuance. The Department argued that duty payment was a prerequisite to relinquishing title, a stance the Tribunal rejected. It reasoned that if an importer intends to pay duty, they would not abandon the goods. The show cause notice did not constitute a clearance order, and loss or destruction of goods under Section 23(1) was not a precondition for relinquishing title under Section 23(2). Referring to precedent, the Tribunal emphasized that the right to abandon goods exists before the clearance order and upheld the appellants' right to do so in this case. Additionally, the Tribunal distinguished a Delhi High Court judgment on remission of duty due to loss, stating it was not applicable here as it concerned a different provision. Ultimately, the Tribunal ruled in favor of the appellants, holding that they validly relinquished their title under Section 23(2) and were not liable for duty or interest. The impugned order demanding duty was set aside, and the appeal was allowed in favor of the appellants.
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