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TMI Blog2008 (9) TMI 91X X X X Extracts X X X X X X X X Extracts X X X X ..... direction to return sum of Rs. 2 crores deposited under coercion and threat. 2. Case of the petitioner is that in August/September 2007, he imported 14 consignments of 1843 MT EVA. He declared value of the goods to be USD 1100-1156 PMT. The department enhanced value from USD 1100 to USD 1560 PMT. The petitioner paid assessed duty under protest and sought passing of a speaking order under section 17(5) of the Customs Act, 1962. The petitioner also paid about Rs. 1 crore as custom duty. In March/June 2008, the petitioner again imported EVA and DCP and filed Bill of entry. The Assessing Officer permitted clearance of goods after revising the value on the basis of contemporaneous import. 3. On 10-7-2008, representative of Directorate of Revenue Intelligence this conducted search at the business premises of the petitioner. On account of ill-health and fearing arrest, the Managing Director deposited Rs. 2 crores. On 11-7-2008, representative respondent No. 2 seized material lying at the godown of the petitioner, which was 2833 MT. The petitioner requested for release of goods on 15-7-2008 reiterating the value declared. On 15-7-2008, again representative of respondent No.2 seize ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Central Board of Excise Customs. 7. In the reply filed, apart from denying the averments in the writ petition, stand taken on behalf of the respondents is that the main working of the petitioner was at Delhi and thus, the territorial jurisdiction of this Court could not be invoked merely on account of part of goods having been seized at Panipat. Reliance, inter alia, has been placed on judgments of the Hon'ble Supreme Court in Canon Steels P. Limited v. Commissioner of Customs (Export Promotion), 2007 (218) E.L.T. 161 and Kusum Ingots Alloys Limited v. Union of India, 2004 (168) E.L.T. 3. It has been further stated that the petitioner had alternative remedy in the form of opportunity to reply the show cause notice which will be issued after investigation and thus, writ jurisdiction could not be resorted to during pendency of investigation. Reliance has been placed on judgment of the Hon'ble Supreme Court on Assistant Collector of Central Excise v. Jainson Hosiery Industries, 1979 (4) E.L.T. (J511). 8. As regards deposit of Rs. 2 crores, it is stated the said amount was paid voluntarily towards partial payment of duty evaded. Reasons for seizure are clear f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... emnity bond equivalent to the seizure value as mentioned in panchnama dated 11-7-2008. 4. An undertaking in the form of an affidavit that you will not challenge the identity of the said seized goods during adjudication proceedings or during prosecution if any launched against you." 12. It was submitted that conditions 2 and 3 with regard to demand of bank guarantee to the extent of the value of goods and demand of indemnity bond equal to seizure value of goods were harsh conditions. The department was only concerned with the duty and even according to their provisional estimate, the differential duty worked out to Rs. 1,34,99,633/- which was much lesser than the amount already deposited by the petitioner with them. 13. It was submitted that neither any show cause notice had been issued nor any other justification shown for confiscation of goods and duty assessed having been paid and at best, a case for safe securing duty was made out. 14. Learned counsel for the respondents submitted that seizure value of goods was Rs. 40 crores and even on the ground of undervaluation, the goods could be confiscated in which case, the same will vest in the government and, thus, the d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er, such rights can certainly be enforced. It cannot be suggested that this Court has no jurisdiction against any illegal action at any stage. Though by way of self restraint, there is alternative remedy, this Court may not interfere, as observed in the judgments relied upon. Issue of release of goods being of urgent nature, if goods are illegally detained or harsh conditions are imposed, affected party can certainly invoke jurisdiction of this Court. 19. Power of effecting seizure under section 110 of the Customs Act can be exercised only on satisfaction that the goods were liable to confiscation. Under section 111(m) of the Act, goods may be liable to confiscation on the ground of undervaluation also. Mere existence of such an extreme power does not render exercise of such power immune from challenge on the ground that the same was arbitrary. This Court may not at the interim stage interfere with the investigation or with the bona fide belief that it was necessary to effect seizure but again existence of such extreme power could not be a handle in the hands of officers of the Custom department to act arbitrarily without any rational basis. Thus, validity or otherwise of condi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich Courts in this country would be prepared to go in considering the validity of orders of the Government of its officers. In that sense the decision of the House of Lords in padfield v. Minister of Agriculture Fisheries end Food (1968 AC 997) is a landmark in the history of the exercise by Courts of their power of surveillance. 13. The Executive have to reach their decisions by taking into account relevant considerations. They should not refuse to consider relevant matter nor should take into account wholly irrelevant or extraneous consideration. They should not misdirect themselves on a point of law. Only such a decision will be lawful. The courts have power to see that the Executive acts lawfully. It is no answer to the exercise of that power to say that the Executive acted bone fide nor that they have bestowed painstaking consideration…………" ( Hochtief Gammon v. State of Orissa Ors. - AIR 1975 SC 2226) "........That Court has power, by the prerogative writ of mandamus, to amend all errors which tend to the oppression of the subject or other misgovernment, and ought to be used when the law has provided no specific remedy, and justice and good government require that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Pvt. Ltd. V. UOI , AIR 1986 SC 872). 21. In the present case, we do not consider it necessary to examine the bona fides of the respondents in exercising power of effecting seizure without recording any reasonable belief of liability of goods to confiscation before effecting seizure in view of limited prayer pressed. We do find that harsh conditions sought to be imposed can hardly stand scrutiny on the anvil of concept of reasonable procedure and reasonableness and fairness. It is well settled that even in case of existence of power, exercise thereof has to be fair and reasonable and consistent with the principle of proportionality. Neither any provisional assessment has been made nor any show cause notice has so far been given. Only allegation so far made is undervaluation. 22. Having regard to judgment of the Delhi High Court in Vipul Overseasand other orders of this Court referred to above and also in view of order Annexure P. 14 passed by the respondents deciding to provisionally release the goods, we are of the view that goods are liable to be released. Condition of execution of indemnity bond equivalent to seizure value of goods or furnishing of bank guarantee equal t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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