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2022 (11) TMI 62 - AT - CustomsRefund of sale proceeds of Gold - Gold disposed off without following the procedure under Section 110(1A) of the Customs Act - whether appellants are entitled to receive the differential value of the seized gold between the value prevailing on the date of melting i.e. 01.08.2018 and value as on the date of which the cheque was given to the Appellant? HELD THAT:- Admittedly, against the order-in-original dated 09-03-2018 the appellants had filed the appeals before the Tribunal challenging / questioning the correctness of the entire impugned order passed by Ld. Adjudicating authority ordering for absolute confiscation of gold and imposing penalties on Appellants. During the pendency of the appeal, it appears that the department took steps to dispose of the said disputed Gold, through the SBI Bullion Branch - the Department has to necessarily await the decision of the Tribunal and abide by the direction that has been issued by the Tribunal. In the instant case, during the disputed period the matter was sub judice before the Tribunal, but the Department in a haste manner has disposed 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 action of the department is clearly in gross violation of principles of natural justice, hence the same cannot be allowed to sustain. The appellants are entitled for the refund of differential value of the gold as claimed by them alongwith interest - Appeal allowed.
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