2019 (3) TMI 1341 - AT - Customs

Provisional release of seized consignments - LED monitors - Revenue was of the opinion that these were television monitors - Held that - Even after lapse of more than one year and three months we are not in a position to be told that whether proceedings under Section 124 have been commenced or not. Revenue is not in a position to say whether 110(2) extension has been granted or not. However, since appellant have been pursuing with regard to modification of order of provisional release of the seized goods we agree to the prayer made with respect to the terms and conditions - Bank guarantee equivalent to 100% of differential duty and probable redemption fine and penalty cannot be justified, even to the extent as modified by the Commissioner(Appeals). Revenue is directed to allow provisional release on execution of bond of value and bank guarantee of ₹ 7 lakhs within a period of one month from date of receipt of this Order - appeal allowed in part.

Summary

Issues:
- Modification of terms of provisional release of seized consignment
- Interpretation of Customs Act, 1962 regarding provisional release
- Justification of bank guarantee amount for provisional release

Analysis:

1. Modification of Terms of Provisional Release: The appeal was filed against the Order of Commissioner(Appeals) that modified the terms of provisional release of a consignment seized by reducing the bank guarantee. The appellant had imported LED monitors declared as "LED monitors for computer screen," but Revenue claimed they were television monitors. The goods were seized, and provisional release was offered, which led to the appeal. The appellant argued for less harsh terms based on a Supreme Court decision, and the Tribunal agreed to modify the terms, reducing the total bank guarantee to ?7 lakhs.

2. Interpretation of Customs Act, 1962: The appellant contended that no notice under Section 124 of the Customs Act, 1962 had been issued, and goods should be unconditionally released under Sections 110(1) and 110(2). The Revenue argued that the issue was about provisional release, and the Tribunal considered the matter based on a Circular and a Delhi High Court decision. Despite uncertainties regarding the initiation of proceedings under Section 124 and the extension under Section 110(2), the Tribunal focused on the modification of the provisional release terms.

3. Justification of Bank Guarantee Amount: The Tribunal found that the bank guarantee equivalent to 100% of the differential duty and probable redemption fine and penalty, even after modification by the Commissioner(Appeals), was not justified. Referring to a Supreme Court decision, the Tribunal reduced the bank guarantee to 30% of the original amount imposed by the Original authority. The Revenue was directed to allow provisional release upon the execution of a bond and a bank guarantee of ?7 lakhs within a specified period.

In conclusion, the Tribunal partially allowed the appeal, emphasizing the need to balance the terms of provisional release with the circumstances of the case and relevant legal precedents.