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2022 (6) TMI 929 - AT - CustomsProvisional release of seized imported goods - determination of redemption fine - Copper cathode - mis-declaration with regard to origin of goods - goods are of Zambian origin or of Iranian Origin - section 110A of Customs Act, 1962 - HELD THAT:- Though power to seize has inhered, and as it should, in Customs Act, 1962 from the very beginning, and, indeed, as legacy carried over from section 178 of Sea Customs Act, 1878, for close to a century and half, it was only by section 26 of Taxation Laws (Amendment) Act, 2006, incorporating section 110A in Customs Act, 1962, that ‘provisional release’ of seized goods by Commissioner of Customs pending order of the adjudicating officer found acknowledgment in law. The transition from statutorily mandated continuation of ‘unilateral’ deprivation of custody till conclusion of adjudication to that of reverting custody can only be described as facilitating. Undoubtedly, it was intended to benefit the importer but it was not at the cost of advantage to the State - The law does not intend that the State is enriched by fines arising from breach of the law or by substituting for the importer to trade in goods seized or even confiscated. The judicial approval was not forthcoming for the several strands of deployment of section 110A of Customs Act, 1962 that was manifested in ways and means of retention of seized goods till adjudication and beyond, upon confiscation, till appellate remedy was exhausted. The implementation of the incorporation for provisional release appeared to be founded on the belief that the said mechanism for conditional restoration of possession to the owner was restrictive and a measure to safeguard revenue. Before section 110A was incorporated in Customs Act, 1962, seized goods, upon confiscation, were offered for redemption on payment of fine and goods, subject to confiscation proceedings without the preliminary of retention by operation of ‘common practice’, could be saddled with fine in lieu thereof. Over the years, the quantification of fine has been placed within the practical framework of offsetting the potential for windfall deriving from the breach for which the goods are confiscated. Rarely would it be the value of goods; some proportion thereof suffices. There can be no golden formula for it and it is here that the discretion of the authority is called for - It is moot if a tentative estimation prior to adjudication can hold a candle to the assured accrual to the State after adjudication, subject, of course, to appellate determination - the extent of mandatory pre-deposit should, in most cases, be the benchmark for quantification of reasonable security. At least, as far as the impugned goods are concerned. The provisional release of the seized goods is permitted subject to furnishing of bond for the value of the goods and execution of bank guarantee of ₹ 50,00,000 - appeal disposed off.
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