2018 (10) TMI 1332 - AT - Customs

Classification of imported goods - consignment of water filter fitting Reverse Osmosis (RO) Membrane - whether classified under CTH 84212120? - Held that - The condition of provisional release appears to be financially tough on the part of the appellant and since the appellant is providing a bond of full value of seized goods and as the importer is a regular importer, it is proper to revise the above-mentioned conditions of the provisional release and allow the seized goods to be taken on provisional basis by complying with the following conditions - (i) that the importer will furnish bond for the full value of the seized goods in a proper format of the bond prevalent in the Customs Department; (ii) at the time of the release of the goods the importer will make full payment of the duty assessed on the declared value of the import consignment; (iii) that as a security to the above-mentioned bond a bank guarantee of ₹ 5,00,000/- will also be submitted to the Customs Department. The bank guarantee shall contain the auto renewal clause. Appeals are allowed with the direction to the Customs Department that on compliance of the above conditions the goods may immediately be released to the appellant.

Summary

Issues:
1. Valuation of imported goods
2. Provisional release of seized goods
3. Judicial direction for approaching CESTAT

Valuation of imported goods:
The case involved M/s Mishika Enterprises importing water filter fitting Reverse Osmosis (RO) Membrane, classified under Customs Tariff Heading No. 84212120. The Directorate of Revenue Intelligence doubted the declared value, leading to seizure of the goods. The appellant requested provisional release, which was granted with stringent conditions by the Joint Commissioner. The High Court directed the appellant to approach CESTAT for challenging the conditions. Upon review, CESTAT found the conditions financially burdensome and revised them. The revised conditions required the appellant to furnish a bond for the full value of the goods, make full duty payment, and submit a bank guarantee of ?5,00,000.

Provisional release of seized goods:
The appellant, feeling aggrieved by the tough conditions imposed for the release of the seized goods, approached the Hon’ble High Court of Delhi. The High Court directed the appellant to seek relief from CESTAT. CESTAT, after considering the preliminary evidence of undervaluation, revised the conditions for provisional release. The new conditions included furnishing a bond for the full value of the seized goods, making full duty payment, and submitting a bank guarantee of ?5,00,000. Upon compliance with these conditions, the seized goods were to be released immediately.

Judicial direction for approaching CESTAT:
The Hon’ble High Court of Delhi, in response to the appellant’s challenge regarding the imposed conditions for provisional release, directed the appellant to approach CESTAT for resolution. CESTAT, after reviewing the case and considering the financial burden on the appellant, revised the conditions for provisional release. The revised conditions aimed to balance the interests of the appellant and the Customs Department, ensuring compliance with necessary procedures while alleviating the financial strain on the appellant.