2024 (12) TMI 968 - HC - Customs

Denial to release the seized consignment on the plea that they intend to appeal the Tribunal s order - imposition of unwarranted conditions - HELD THAT - The Customs Authorities seized the Petitioner s consignment, which contained penetrating oil, on the grounds that it was adulterated and canalized. The Adjudicating Authority and the First Appellate Authority held against the Petitioner. The Petitioner, therefore, appealed to the CESTAT vide Customs Appeal No. 85316 of 2024. By the judgment and order dated 01 July 2024, this Appeal was allowed, and the orders made by the Adjudicating Authority and the First Appellate Authority were set aside. The consignment was seized on 06 November 2023. Necessary samples were taken and analysed. Given the findings in paragraph 13 and the other observations in the Tribunal s judgment and order dated 01 July 2024, it is satisfied that the insistence upon drawing a sample at this late stage is not warranted in the facts of the present case. In all probabilities, this is nothing but buying some time and avoiding compliance with the Tribunal s judgment and order dated 01 July 2024. Because an appeal is being or is proposed to be preferred, the Respondents cannot indefinitely avoid compliance with the Tribunal s judgment and order. The impugned letter dated 05 August 2024 set aside and the Respondents are directed to comply with and consequently release the seized goods within two weeks of the uploading of this order unless, of course, in the meanwhile, the Respondents obtain a stay on the implementation of the Tribunal s judgment and order dated 01 July 2024. Petition allowed.

Summary

Issues:
1. Non-compliance with Tribunal's order for releasing seized consignment.
2. Imposition of unwarranted conditions by Respondents.
3. Dispute over the release of the consignment based on the CESTAT order.
4. Legality of insisting on drawing a sample before provisional release.

Analysis:

1. The Petitioner complained about the Respondents not releasing the seized consignment despite the Tribunal's order. The Petitioner sought a writ of mandamus to quash the unreasonable conditions imposed by the Respondents. The Respondents justified their actions by stating they were in the process of appealing the Tribunal's order. The Court had to determine the validity of the non-release of the consignment.

2. The Customs Authorities seized the consignment, alleging it was adulterated and canalized. The Adjudicating Authority and the First Appellate Authority ruled against the Petitioner. However, the CESTAT allowed the Petitioner's appeal, setting aside the previous orders. The CESTAT found that the classification adopted by the lower authorities was not in accordance with the law, leading to the release of the consignment.

3. The Respondents were obligated to release the confiscated consignment following the CESTAT order unless they appealed and obtained interim relief. Despite this, the Respondents insisted on drawing a sample before provisional release, citing an appeal to the Supreme Court. The Court found this unnecessary and ordered the Respondents to comply with the CESTAT order within two weeks, unless a stay was obtained.

4. The Court set aside the Respondents' letter imposing conditions for the release of the goods, emphasizing that the Respondents cannot indefinitely delay compliance with the Tribunal's order. The judgment highlighted that the insistence on drawing a sample at a late stage seemed to be a tactic to avoid implementing the Tribunal's decision. The Court directed the release of the seized goods unless a stay was obtained on the Tribunal's order.

This detailed analysis covers the issues of non-compliance with the Tribunal's order, unwarranted conditions imposed by the Respondents, the dispute over the release of the consignment based on the CESTAT order, and the legality of insisting on drawing a sample before provisional release.