2015 (1) TMI 531 - HC - Customs

Seizure of goods - provisional release of the goods - Held that - As is evident from a reading of the impugned order, over and above the duly paid, i.e. ₹ 10.09 lakhs, the Commissioner has insisted upon execution of a bond for the re-determined value of the goods, i.e., ₹ 84,79,376/-. In addition, he has insisted upon furnishing a bank guarantee to the tune of ₹ 30 lakhs and payment of differential duty of ₹ 12,15,577/-. Under normal circumstances, this Court would have relegated to the petitioner to the remedy of appeal to the CESTAT. However, we are of the opinion that since the petitioner had already approached this Court and having regard to the nature of the goods and the order, this Court is of the view that the conditions are excessive, in the circumstances, the goods are directed to be released upon the petitioner furnishing differential duty and on furnishing a bond for ₹ 20 lakhs. Upon compliance with these directions, the goods are directed to be released. - Decided partly in favour of assessee.

Summary

Issues:
1. Imposition of onerous conditions for provisional release of goods.
2. Interpretation of Customs (Provisional Duty Assessment) Regulations, 2011.
3. Justifiability of intervention by the Court in writ proceedings.

Detailed Analysis:
1. The petitioner was aggrieved by the imposition of what was considered onerous conditions for the provisional release of goods. The petitioner had imported maintenance-free batteries and had already deposited the customs duty on the declared value. The Directorate of Revenue Intelligence (DRI) seized the goods, prompting the petitioner to approach the Court under Article 226 of the Constitution of India. The Court directed the Commissioner of Customs to make a decision on the application for provisional release of the goods.

2. The Commissioner's order required the petitioner to fulfill several conditions for the release of the seized goods, including payment of a differential duty amount, execution of a bond for the re-determined value of the goods, furnishing a bank guarantee, providing a solvency certificate, and affixing MRP stickers on items. The petitioner argued that the conditions were excessive, considering the stipulations in Regulation 2(2) of the Customs (Provisional Duty Assessment) Regulations, 2011, which mandated a 20% deposit of the duty amount.

3. The Counsel for the Revenue contended that there was no justification for the Court's intervention in writ proceedings, suggesting that the order was appealable. However, the Court found the conditions imposed by the Commissioner to be excessive, especially in light of the already paid duty amount. Despite normally directing the petitioner to appeal to the CESTAT, the Court decided to intervene due to the nature of the goods and the perceived excessiveness of the conditions. Consequently, the Court directed the release of the goods upon the petitioner furnishing the required differential duty and a bond for a reduced amount, thereby disposing of the writ petition and all pending applications.

This detailed analysis covers the issues of the imposition of conditions for provisional release of goods, the interpretation of relevant regulations, and the justifiability of the Court's intervention in the writ proceedings, as outlined in the judgment delivered by the Delhi High Court.