2015 (2) TMI 262 - AT - Customs

Provisional release of the seized goods imported on certain conditions - Held that - Neither Section 18 or Section 110A provides that security of provisional assessment of release of the goods shall necessarily means on such conditions. The terms and condition are required to maintain a balance between the prejudice being caused to the appellant and securing the interest of Revenue adequately. For provisional release, Customs (Provisional Duty Assessment) Regulations, 2011 provides condition for allowing provisional release and Regulation 2 provides for conditions of provisional release - At this stage, it cannot be decided that the appellant has resorted to undervaluation or not. Or the Revenue is correct to assess provisionally on the basis of the Load Port invoice. Therefore, the determination of value would be done at the time of final assessment/adjudication. In these circumstances, directing to execute bank guarantee or revenue deposit, for redemption fine or fine in the facts and circumstances is harsh. Therefore, impugned order is modified to the extent that the impugned goods be allowed to release provisionally on execution of provisional duty cum provisional release bond equal to the re-determined value as per Annexure and on payment of duty on declared value plus 20% of the duty on differential amount - The impugned goods to be released within 7 days after compliance of the above said conditions The order is modified accordingly - Appeal disposed of.

Summary

Issues:
1. Maintainability of appeal before Single Member Bench due to valuation of goods.

Analysis:
The appellant appealed against the impugned order allowing provisional release of seized goods imported under a bill of entry, raising doubts on the maintainability of the appeal before the Single Member Bench. The appellant argued that the issue did not relate to confiscated goods or fines/penalties, and the differential duty did not exceed Rs. 50 lakhs, making it suitable for the Single Member Bench under Section 129C(4) of the Customs Act, 1962. Citing relevant case laws, the appellant contended that the appeal could be decided by a Single Member Bench.

The respondent, however, argued that the value issue could impact the provisional release order, suggesting a Division Bench reference. The tribunal considered both sides' submissions and referred to previous judgments to conclude that since the impugned order was solely for provisional release without deciding on duty value or classification, the appeal could be heard by the Single Member Bench.

The tribunal proceeded to allow early hearing of the appeal due to the live consignment nature and proceeded to the final hearing with the consent of both parties. The appellant had imported LED torches under scrutiny for undervaluation, leading to a writ petition and subsequent seizure. The appellant contested the harsh conditions imposed for release, arguing for modification based on previous tribunal orders and legal precedents.

After considering arguments from both sides, the tribunal found that the issue primarily concerned provisional assessment, not seizure justification. It highlighted the need to balance appellant prejudice and revenue interests in setting release conditions. Referring to Customs Regulations, the tribunal modified the release conditions to a provisional duty bond equal to the re-determined value and payment based on declared value plus 20% of the differential amount, allowing release within 7 days.

In conclusion, the tribunal disposed of the appeal with modified release conditions, emphasizing the provisional nature of the assessment pending final determination of duty value.