2023 (9) TMI 366 - HC - Customs

Permission for provisional release of the goods - ball-bearings - Section 110A of the Customs Act 1962 - SCN not adjudicated for almost one year - HELD THAT - It is clear that in the present case Respondent No. 2 has not only failed to take cognizance of the repeated applications of the Petitioner when powers were conferred on him to exercise discretion either to release the goods provisionally or impose conditions and grant provisional release or reject the provisional release of the goods. However he appears to have acted in complete disregard of his powers and duties - such approach of Respondent No. 2 is certainly not conducive either to the position he wields under the legislation or the public trust he would repose in discharging his statutory duties. This could not have been the approach of Respondent No. 2 even acting under the Circular as pointed out by Mr. Adik in requiring Respondent No. 2 to consider any application for release of goods provisionally. The goods in question are subject matter of one bill of entry. Show cause notice itself although is issued on 22nd April 2022 for almost one year has not been adjudicated and in fact appears to have not progressed at all - a situation cannot be permitted where the Petitioner would suffer on both the counts at the hands of Respondent No. 2 - There is no acceptable reason that the petitioner in law should be denied provisional release on conditions. This is a fit case where the prayers as made by the Petitioner for provisional release of the goods need to be granted - Petition allowed.

Summary

Issues Involved:
1. Provisional release of seized goods.
2. Non-response to repeated requests for provisional release.
3. Application of guidelines for provisional release.
4. Statutory duties of customs authorities.

Summary:

Issue 1: Provisional release of seized goods
The petitioner sought a writ of mandamus for the provisional release of ball-bearings under Section 110A of the Customs Act, 1962, pending adjudication of a show cause notice dated 22nd April 2022. The goods were seized based on allegations of undervaluation. Despite repeated requests for provisional release, the Respondents did not respond, compelling the petitioner to file the present petition.

Issue 2: Non-response to repeated requests for provisional release
The petitioner addressed multiple letters to the customs authorities from December 2021 to July 2023, requesting provisional release of the goods. However, Respondent No. 2 failed to respond to any of these letters. This non-response was seen as an abdication of statutory duty, affecting the petitioner's business interests.

Issue 3: Application of guidelines for provisional release
The Respondents argued that any provisional release should follow the guidelines issued in the Revenue Circular dated 16th August 2017. This circular provides discretion to the customs authorities to demand a bond or security deposit for provisional release. The court noted that while the circular offers guidelines, it does not bind the court's discretion in granting provisional release.

Issue 4: Statutory duties of customs authorities
The court criticized Respondent No. 2 for failing to address the petitioner's repeated requests, emphasizing that public officials must respond to such representations. The court highlighted the importance of fairness, non-arbitrariness, and non-discrimination in the exercise of statutory duties.

Judgment:
The court allowed the petition, directing the provisional release of the goods upon the petitioner furnishing a bond and undertaking to pay any duty, fine, or penalty adjudged by the authorities. The court also stressed the need for customs officers to decide provisional release applications expeditiously and transparently, urging the Principal Chief Commissioner of Customs to issue necessary directions to ensure timely decisions on such applications. The petition was disposed of with no costs, and parties were instructed to act on the authenticated copy of the order.