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2016 (6) TMI 955 - PUNJAB AND HARYANA HIGH COURT

2016 (6) TMI 955 - PUNJAB AND HARYANA HIGH COURT - 2016 (340) E.L.T. 27 (P & H) - Provisional release of seized goods - seizure of Cigarettes and restricted R-22 Gas, which were admittedly imported by the petitioner company by concealment in aluminium scrap and mis-declaration of material particulars in the three Bills of Entry - It is submitted that although the R-22 Gas is a 'restricted' item for import, and the goods Cigarettes and the R-22 Gas were imported by concealment, however, none of t .....

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entitled for an option to redeem the goods even upon adjudication. In such case, Section 110A concerning provisional release would be applicable. - Although the petitioners have raised a substantial question of law regarding applicability of section 4(2) of the Code, which has prima facie merits. However, since the petitioners have shown their willingness to adopt the route of settlement and to discharge their duty liability even before issuance of notice under Section 28, we deem it appropr .....

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r the respondents. 3. The first grievance raised in the petition revolves around interpretation of Section 4(2) of the Code. It is contention of the petitioners that the Respondents are not following the procedure prescribed under Section 154, 157, 167, 172 and 177 of the Code, despite absence of any provision inconsistent with the same in the Act. Several orders granting interim protection pending decision on this very issue are already placed on record and referred in the earlier Order dated 1 .....

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titioner company has admitted mis-declaration in these three Bills of Entry and is willing to pay the differential duty on the Cigarettes for seeking its provisional release, and is willing to resort to statutory route of self-surrender by invoking jurisdiction of Settlement Commission for settlement of case at once upon issuance of show cause cum demand notice in respect of these three Bills of Entry. The settlement Commission is statutorily empowered to grant immunities from penalty, fine and .....

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fiscation under Section 111. In respect of such goods even if the same are confiscated upon culmination of adjudication under Section 28 read with 124 of the Act, the owner/importer 'shall' be given an option to redeem the goods on payment of redemption fine in terms of Section 125 of the Act. Section 110A of the Act provides for provisional release of seized goods even pending adjudication. The petitioner company relies upon the Order dated 4.8.2015 of the Customs Excise and Service Tax .....

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T 8 (SC), wherein the Hon'ble Apex Court inter alia observed that the meaning of word prohibited will have to be construed in regard to the text and context in which it is used and the words prohibition, restriction and regulation are meant to be applied differently. The Tribunal also observed that in the context of Section 111(d) or 113(d), in several precedents, the definition of 'prohibited goods' as contained in Section 2(33) of the Customs Act, 1962 has been applied liberally, i .....

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ning the scope of words 'unless the context otherwise requires' appearing in Section 2(33) for application of the definition of 'prohibited goods', and rightly held that the liberal definition of Section 2(33) which is applied in the context of Section 111 or 113 cannot be applied in the context of Section 125. The Tribunal relied upon the judgment of Hon'ble Andhra Pradesh High Court in Shaik Jamal Basha vs. GOI, 1997 (91) ELT 277 (AP), wherein after considering both Section .....

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in respect of goods which can be imported, but because of the method of importation adopted, become liable for confiscation. Hon'ble Madras High Court in T Elavarasan, 2011 (266) ELT 167 (MAD HC), was pleased to rely on the said judgment of Hon'ble Andhra Pradesh High Court and held that an option has to be given to the petitioner to pay the applicable customs duty and the redemption fine and to get the gold jewellery released, as per Section 125 of the Customs Act, 1962. In the context .....

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nfiscation under Section 111 and 113 as the case may be without there being any violation of the provisions under the Customs Act, 1962 or under any other law or rules, regulations made thereunder. Therefore, in the context of statutory provisions of Section 125, so as to give a meaningful application to both words 'may' and 'shall' used in the said Section, the definition of 'prohibited goods' is inapplicable by application of settled principles of statutory interpretati .....

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who is owner as well as importer would be entitled for an option to redeem the goods even upon adjudication. In such case, Section 110A concerning provisional release would be applicable. 7. In the instant case, the stand taken on behalf of DRI was that the goods which according to their own estimate have local market value of ₹ 10 Crores would be absolutely confiscated and would have to be burnt or destroyed, and that such cases of fraud cannot be settled by the Settlement Commission. On .....

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ty, fine and penalty where Cigarettes were illegally imported by concealing them among Radio Cassette Recorders. Therefore, even other objections are without merits. 8. It was further stated on behalf of DRI that so far as payment of duty or provisional release is concerned, the same is to be determined or decided by the Commissioner of Customs at Ludhiana. The Commissioner of Customs (Preventive), Amritsar who holds the charge of Commissioner of Customs at Ludhiana, has filed a short affidavit .....

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etermine the duty i.e. would be the adjudicating authority. In such peculiar circumstances, we find it just and expedient to entertain the request of the petitioner company for considering conditional provisional release of the seized Cigarettes instead of relegating the petitioner company to the respondents for deciding this issue of provisional release of seized Cigarettes which are perishable in nature. 9. The Respondents have doubted the genuineness of the invoices submitted by the petitione .....

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rettes is ascertained by the DRI as evident from the Panchnama, but no assessable value for the purpose of arriving at duty liability is proposed either in the remand application or before this Court. The Local market value would be inclusive of duties and taxes etc. The Invoices submitted before the Court under Affidavit cannot be brushed aside. 12. We therefore find it reasonable to permit provisional release of the seized Cigarettes on submission of a bond for total ₹ 6,21,14,598/- inde .....

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ns of cigarettes shall be released on provisional basis within 48 hours; (b) Within 10 days thereafter, the petitioner company would deposit the differential duty in respect of 300 cartons of cigarettes admittedly imported by concealment vide Bill of Entry no. 4308262 Dated 19.2.2016. Upon making such payment the said seized 300 cartons of cigarettes shall be released on provisional basis within 48 hours; (c) Within 10 days thereafter, the petitioner company would deposit the differential duty i .....

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