Guidelines for expeditious Customs clearance/provisional release - CBEC's Customs Manual 2023 - Customs

2. Guidelines for expeditious Customs clearance/provisional release: 2.1 To avoid delays in the release and minimize hardship to the trade if goods remain detained pending investigation into any dispute in relation to assessment etc., the stress is on expeditious assessment/investigations. Further, unless the goods are prohibited or involved in serious fraud even if there is a dispute in assessment etc., provisional release option is given to the importers. 2.2 Goods are not to be detained on simple valuation or classification disputes. If it becomes necessary to detain the goods for investigation of any serious suspected fraud etc., the importer/ exporter must be intimated in writing that he may shift the goods to a bonded warehouse under Section 49 of the Customs Act, 1962 , with a clear indication that if he does not avail of this facility and the goods incur demurrage, etc., he would have to bear the demurrage and other charges levied by the custodian/other agencies. 2.3 Seized imported goods shall be released provisionally, upon request of the owner of the seized goods, subject to executing a Bond for the full value / estimated value of the seized goods. 2.4 In addition to the Bond, a Bank Guarantee or security Deposit to cover: The entire amount of duty/differential duty leviable on such goods; Amount of fine that may be levied in lieu of confiscation under Section 125 of the Act; Amount of penalties that may be levied under the Act as applicable at the time of adjudication; The competent authority may increase or decrease the amount of Security Deposit. 2.5 The adjudicating authority, specifying the reason, may deny provisional release of any goods which are liable to confiscation under Section 111 of 113 or as defined as Prohibited Goods under section 2(33) ( Malabar Diamond Gallery Pvt Ltd Vs Additional Director General, Directorate of Revenue Intelligence, Chennai- 2016 (341) E.L.T 65 (Mad. ). 2.6 Distinction between Provisional Assessment Provisional Release: The Hon`ble Madras High Court in the Malabar Diamond Gallery Pvt Ltd Vs Additional Director General, Directorate of Revenue Intelligence, Chennai- 2016 (341) E.L.T 65 (Mad.) , held that although the import of gold was not prohibited, if the import was in violation of the Conditions attached to such import amounts to smuggling and that a prayer for release could be refused. Further, the Hon`ble High Court of Delhi in Petrochemical Polymers Vs. The Addl. Director General, DRI Anr, held that the power under Section 110A of the Act involves exercise of discretion the scope of judicial review if the discretion has been rightly exercised, that treatment of all types of wrongful imports on an equal footing might result in miscarriage of justice, hence the said Section leaves some margin to the Customs in the exercise of their discretion. 2.7 The Bond shall contain an undertaking that the importer shall pay the duty, fine and or penalty as the case may be adjudged by the Adjudicating Authority. 2.8 Further, where security is furnished by way of Bank Guarantee, the Bank Guarantee should contain a clause binding the issuing Bank to keep it renewed valid till final adjudication of the case. In the case of non-renewal of guarantee, the guaranteed amount be credited to the Government account by the Bank on its own. 2.9 While provisional release of seized imported goods under Section 110A of the Customs Act, 1962 may normally be considered by the competent adjudicating authority upon a request made by the owner of the seized goods, provisional release shall not be allowed in the following cases (i) Goods prohibited under the Customs Act, 1962 or any other Act for the time being in force; (ii) Goods that do not fulfill the statutory compliance requirements/obligations in terms of any Act, Rule, Regulation or any other law for the time being in force; (iii) Goods specified in or notified under Section 123 of the Customs Act, 1962 ; (iv) Where the competent authority, for reasons to be recorded in writing believes that the provisional release may not be in the public interest. [Refer circular 35/2017 dated 16.08.2017 ]