2023 (12) TMI 1113 - HC - Customs

Clearance of warehoused Goods - Seeking clearance to export the consignment of Crude Palmolein imported by the petitioner and warehoused for its own consumption - HELD THAT - The question for consideration would be whether an importer of a warehoused consignment could, pending investigation as regards the previous imports and when the clearance is not issued under Section 68 of the Customs Act, have recourse to the right to export as contemplated under Section 69 of the Customs Act without paying import duty, and the concerned must examine this question simultaneously with the question whether the petitioner, even if it does not derive any profit from export of the warehoused consignment, would be liable to pay import duty, and conversely, whether the Revenue would be entitled to recover import duty. These aspects will have to be considered recording reasons for the conclusion to enable complete adjudication. In view of the exigent circumstance viz. that the consignment is a perishable commodity with a shelf life which expires on 21.12.2023 and the petitioner proposes to export the consignment within this time filing shipping bills and other documents to demonstrate that it cannot receive a price which is more than the price at which the consignment is imported, the proper officer must consider these questions and take a decision within a reasonable time, and this Court must observe that if the petitioner is permitted to export upon furnishing a Bank Guarantee, and the Bank Guarantee is so furnished, the same will be subject to the final decision on the questions as aforesaid. The petition is disposed of with liberty to the petitioner to file a request to export the warehoused consignment of Crude Palmolein imported and warehoused under Section 69 of the Customs Act with the shipping bills and such other documents to demonstrate the price that it will receive on export of crude Palmolein.

Summary

Issues involved:
The petitioner sought directions for clearance to export a consignment of Crude Palmolein and to quash a communication calling for a Provisional Duty Bond and Bank Guarantee.

Consideration of first prayer:
The petitioner confined the petition to seeking clearance for export of the consignment due to its shelf life and potential loss of value if not utilized by a certain date.

Import duty exemption claim:
The petitioner imported Crude Palmolein claiming exemption from import duty, which is warehoused with the department, and a communication was issued by the first respondent regarding the consignment.

Right to re-export without duty:
The petitioner argued that, as the consignment is warehoused, it should be allowed to re-export without paying import duty, provided necessary documents are produced as per the Customs Act.

Respondents' stance and bank guarantee requirement:
The respondents stated that export request will be considered upon furnishing necessary documents and a bank guarantee for the consignment's value, citing an ongoing investigation on previous imports.

Legal precedent and bank guarantee necessity:
The respondents referred to a Gujarat High Court decision to support the requirement of a bank guarantee, emphasizing the need for it in the Revenue's interest amid ongoing investigations.

Petitioner's counter-argument:
The petitioner contended that, under Section 69 of the Customs Act, they should be allowed to export the consignment without the need for a bank guarantee, irrespective of potential profit.

Court's stance and further examination:
The Court noted that the request for clearance under Section 69 is pending examination by the respondents, and the necessity of a bank guarantee should be assessed based on various factors, including freight charges.

Key legal questions for consideration:
The Court highlighted the need to determine if an importer can export a warehoused consignment without paying duty during ongoing investigations, and whether the petitioner is liable to pay duty even without profit from export.

Decision and directives:
The Court disposed of the petition, allowing the petitioner to file a request for export with necessary documents within a week, subject to the proper officer's decision under Section 69 of the Customs Act.