2024 (10) TMI 1413 - HC - Customs

Import of cylinders without a PESO certificate - non-compliance with Rules 31 and 32 of the Gas Cylinder Rules, 2016 - goods under the bill of entry confiscated under Section 111(d) of the Customs Act, 1962 - as argued reasons entirely attributable to the PESO Authorities, the Petitioner cannot be made to suffer either confiscation or Penalty -Respondents, pointed out that even if the incorrect PESO Certificate dated 25th April 2024 were to be regarded as valid, still, the goods, in this case, arrived on 16th April 2024 i.e. before the date of such certificate - redemption fine and the penalty imposed HELD THAT - Considering that in the present case, the value of the Cylinders is around Rs. 31 lakhs, we direct that the Cylinders be provsionally released subject to the Petitioner furnishing the usual bonds and paying the concerned Respondents an amount of Rs. 2,00,000/- without prejudice to the Petitioners rights and contentions that in the present case, no penalty or redemption fine is payable. All parties' contentions in the context of the Show Cause Notice issued are left open. Petitioner states that the payment and other formalities will be completed by 30 October 2024. When this is done, the cylinders must be released immediately. We clarify that the payment of Rs. 2,00,000/- will abide by the conclusion in the adjudication of proceedings pursuant to the Show Cause Notice already issued. ORDER - Seventh and Eighth Respondents are directed to provisionally release the Cylinders upon the Petitioner furnishing the usual bonds for paying an amount of Rs. 2,00,000/- without prejudice. Petitioner is granted the liberty to file reply to Show Cause notice by 30 October, 2024.

Summary

Issues:
Challenging a notice alleging noncompliance with Customs Act and Gas Cylinder Rules, validity of PESO certificate, provisional release of cylinders, adjudication of Show Cause Notice.

Analysis:
The Petitioner challenged a notice dated 28 May 2024, accusing them of trying to import cylinders without a PESO certificate. The notice sought to confiscate goods under the Customs Act for noncompliance with Gas Cylinder Rules. The Petitioner argued that the PESO certificate was applied for on 9 April 2024, issued on 25 April 2024 with incorrect particulars, necessitating a fresh certificate on 10 May 2024. The Respondents contended that even if the incorrect certificate was valid, the goods arrived before its issuance, constituting a breach. The Court found both parties' arguments arguable and refused to quash the notice, directing adjudication of the Show Cause Notice within two weeks.

The Court acknowledged the Petitioner's right to provisional release of the cylinders from the warehouse, subject to conditions. It noted the value of the cylinders at approximately Rs. 31 lakhs and directed their release upon the Petitioner furnishing bonds and paying Rs. 2,00,000 to the Respondents. The Court clarified that the payment would be subject to the conclusion of the adjudication proceedings following the Show Cause Notice. The Petitioner was granted liberty to file a reply to the notice by 30 October 2024, with the Respondents required to dispose of the notice within two weeks of receiving the reply after providing the Petitioner an opportunity to be heard.

In the final order, the Court directed the Seventh and Eighth Respondents to provisionally release the cylinders upon the Petitioner furnishing bonds and paying Rs. 2,00,000. The Petitioner was granted the liberty to file a reply to the Show Cause Notice by a specified date, with the Respondents mandated to adjudicate the notice within two weeks of receiving the reply. The writ petition was disposed of with no cost order, and all parties were instructed to act on an authenticated copy of the order.