2018 (8) TMI 569 - HC - Customs

Anticipatory bail - Import of Australian Desi Chickpeas - goods is covered by the Tariff Item No.07132000 where the duty payable was Nil only as per the N/N. 50 of 2017 dated 30.06.2017 - on 21.12.2017, the N/N. 93 of 2017 was displayed on the notice board of the Customs House and published in the Official Gazette around 10 45 p.m., whereby the duty of Australian Desi Chickpeas was raised to 30% advalorem - demand of differential duty alongwith Interest. Held that - This Court had specifically queried with the learned counsel with regard to the stand taken by the Department considering the fact that the Notification under section 93 of 2107 issued by the Department of Revenue, Ministry of Finance, was issued on 21.12.2017 at 10 45 p.m. and the official gazette also was published at 10 45 p.m. which had replaced the earlier Notification No.50 of 217 dated 30.06.2017, where the import duty on assessment of Australian Desi Chickpeas was nil. Nothing could be clarified as to how merely because the goods could not be physically removed from the Port, and when charge order was already issued, this kind of stand continued to be taken by the authority. The applicant has made out a case for grant of anticipatory bail in his favor. The application is allowed by directing that in the event of the applicant herein being arrested pursuant complaint, the applicant shall be released on bail on furnishing one solvent surety of ₹ 50,000/- with one solvent surety of like amount to the satisfaction of the trial Court on certain conditions.

Summary

Issues:
1. Anticipatory bail under section 438 of the Code of Criminal Procedure in connection with a complaint under the Customs Act.
2. Dispute regarding the customs duty on Australian Desi Chickpeas.
3. Allegation of evasion of duty and issuance of summons by the Directorate of Revenue Intelligence.
4. Interpretation of the applicability of Notification NO.93 of 2017 raising duty to 30% advalorem.
5. Grant of anticipatory bail and conditions imposed.

Issue 1: Anticipatory Bail
The applicant sought anticipatory bail under section 438 of the Code of Criminal Procedure after being rejected by the Additional Sessions Judge. The application was allowed by the High Court, directing release on bail with specific conditions, including cooperation with the investigation and availability for interrogation, remaining present at the Police Station, not hampering the investigation, surrendering the passport, and not leaving India without court permission.

Issue 2: Dispute over Customs Duty
The dispute arose over the customs duty on Australian Desi Chickpeas, covered by Tariff Item No.07132000. The duty was initially 'Nil' under Notification NO.50 of 2017, but later raised to 30% advalorem under Notification NO.93 of 2017. The Customs Department alleged nonpayment of duty due to incorrect availing of duty exemption, leading to the summons by the Directorate of Revenue Intelligence.

Issue 3: Allegation of Evasion of Duty
The applicant was called to give evidence and produce documents regarding the alleged evasion of duty. The applicant claimed his statement was recorded under coercion and not by free consent, leading to the apprehension of arrest and the subsequent application for anticipatory bail.

Issue 4: Interpretation of Notification NO.93 of 2017
The Customs Department contended that the duty increase applied once the notification was issued, even though the goods were not physically removed from the port. However, the Court questioned this stand, highlighting the lack of clarity on the applicability of the notification when the goods were already cleared and out of charge order was given.

Issue 5: Grant of Anticipatory Bail
The Court allowed the application for anticipatory bail, emphasizing the lack of material indicating the applicant's involvement in duty evasion. The Court noted that the applicant had made a case for bail, considering the circumstances and the lack of alternative proceedings initiated by the Customs Department for recovery of the duty amount.

In conclusion, the High Court granted anticipatory bail to the applicant, setting specific conditions for cooperation with the investigation and appearance before the trial court. The Court clarified that the observations made during the bail order should not influence the trial court's decision regarding the evidence.