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TMI Blog2022 (11) TMI 62X X X X Extracts X X X X X X X X Extracts X X X X ..... sposed of the goods without seeking permission from the appellate court where the matter was sub judice. Thus, the Department has committed a serious mistake by disposing the disputed goods which was a subject matter of an appeal. In the present matter department also not intimated the Appellants regarding the disposal of confiscated gold. The act of the department ex-part cannot be held as proper and legal. In the KAILASH RIBBON FACTORY LTD. VERSUS COMMR. OF CUS. C. EX., NEW DELHI [ 2002 (3) TMI 57 - HIGH COURT OF DELHI] , the Hon ble Delhi High Court held that it is a serious lapse on the part of the department when it auctioned confiscated goods without permission of the Tribunal during pendency of the appeal without even giving notice to the appellants. It was held that the department has to refund the declared value of the goods with interest per annum from the date of auction of the goods. It is very clear that the department has disposed of /sold the goods on the understanding that the first order of the adjudicating authority is the final order. At the same time the department was well aware about the pendency of the appeals before this Tribunal. Therefore the actio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .08.2018 and date on which cheque was given to the Appellants. The department rejected the request for refund of the differential value of gold with interest. The Appellants requested the Deputy Commissioner to provide the information whether the decisions for granting the refund was taken by Principle Commissioner of Customs or the other officer so as to enable to take an appropriate decisions for filing the Appeal . The Deputy Commissioner informed the Appellant that decision for return of sale proceed of confiscated gold was taken by the Principal Commissioner of Customs. Being aggrieved, the appellants are before us. 3. Shri Hardik Modh learned counsel appearing on behalf of the Appellants submits that since gold is included in the sensitive list, the department ought to have followed the procedure as prescribed under Section 110(1A). The department without following due process of law, as mandated under Section 110(1A) of the Customs Act, disposed of the gold. The procedure prescribed under the Act is not mere formalities. 3.1. He also submits that Section 150 of the Customs Act provides procedure for sale of goods and application of sale proceeds. Section 150 provides t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers staying operations of the order passed by Adjudicating Authority. Language employed in Section -110(1A) ibid, is plain and clear wherein the proper officer shall dispose of the goods specified under the said section, as soon as may be after its seizure. Therefore, disposal of absolutely confiscated gold in accordance with Section -110 (1A) ibid read with relevant notification is both legal and proper. Hence the request of the appellants, seeking refund of the amount as per the market value of gold on the date of handing over of cheque to Appellants is without any basis or support of law. He placed reliance on the following decisions. M/s Vijaybhav Vs CC, Airport Mumbai 2014 (313) ELT 506 (Tri Ahmd.) M/s Raju Agarwal Vs. CC, Patna 2013(296)ELT 339 (Tri. Kol.) Ajanta Music Palace Vs. CC 1993 (68) ELT 414 (Tri.) Badri Naryan Sharma Vs. CCE, Jaipur 2020 (372) ELT 873 4.1 He further submits that Circular No. 711/4/2006-Cus (AS) dated 14.02.2006 was issued with reference to Section 150 of the Customs Act 1962, which deals with procedure for sale of goods, not being confiscated goods. Whereas, the goods covered in present case i.e Gold, is covered under n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s under: 4. Recovery of the Amounts during the pendency of Appeal : 4.1 Vide Circular No. 967/1/2013, dated 1st January, 2013, Board has issued detailed instructions with regard to recovery of the amounts due to the Government during the pendency of stay applications or appeals with the appellate authority. This Circular would not apply to cases where appeal is filed after the enactment of the amended Section 35F of the Central Excise Act, 1944 or Section 129E of the CustomsAct, 1962. 4.2 No coercive measures for the recovery of balance amount i.e., the amount in excess of 7.5% of 10% deposited in terms of Section 35F of Central Excise Act. 1944 or Section 129E of Customs Act, 1962, shall be taken during the pendency of appeal where the party/assessee shows to the jurisdictional authorities : (i) proof of payment of stipulated amount as predeposit of 7.5%/10%, subject to a limit of Rs. 10 crores, as the case may be; and (ii) the copy of appeal memo filed with the appellate authority; 4.3 Recovery action, if any, can be initiated only after the disposal of the case by the Commissioner (Appeal)/Tribunal in favour of the Department. For example, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing strictures against the Customs Department, the Delhi High Court has observed - It had, in our opinion, a moral obligation to inform the CEGAT as also the Supreme Court of India that the goods in question have already been sold in auction. It failed and/or neglected to do so. Prior to putting the goods in question to auction, it was expected that the petitioner would at least be put to notice that on payment of additional duty it could get the imported goods cleared. It is really also a matter of great surprise that the Airport Authorities also sold the goods within two days of the receipt of the list of such goods. 11. We have also gone through the provisions of Section 110(1A) ibid, from the plain the reading of the said provisions it nowhere permits the proper officers for dispose of the disputed goods during the pendency of appeal. 12. In view of our observations, we hold that the ratio of all the abovementioned cases is squarely applicable to the present case. It is very clear that the department has disposed of /sold the goods on the understanding that the first order of the adjudicating authority is the final order. At the same time the department was well a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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