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2016 (7) TMI 485 - DELHI HIGH COURT

2016 (7) TMI 485 - DELHI HIGH COURT - 2016 (340) E.L.T. 507 (Del.) - Request for Release of consignment of gold jewellery imported by it from Indonesia without being asked to furnish a BG for 100% of the differential duty. - Preferential rate of duty on import of gold jewellery by the members of the said Association from Indonesia - Earlier the Court has quashed a Circular dated 6th October 2015 [2016 (4) TMI 1032 - DELHI HIGH COURT] - Held that:- The impugned order dated 8th June 2016 which req .....

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quiring the Petitioner to furnish a BG for 50% of the provisional duty in terms of Regulation 4 of the CPDA Regulations is without reasons and therefore unsustainable in law. - Although the Petitioner may be justified in insisting on unconditional release of the goods in question, considering that the Respondents intend filing an appeal against the said judgment and the Petitioner has by way of a demurer agreed to furnish a bond for 100% of the differential duty and deposit 20% of the provis .....

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gi, Mr. Shashi Mathews and Mr. Rony O. John, Advocates For the Respondents : Mr. Sanjeev Narula, CGSC with Mr. Ajay Kalra, Advocate for R-1, 2, 3,4 & 6. Ms. Pooja Bhaskar, Advocate for Mr. Satish Aggarwala, Senior standing counsel ORDER 1. This petition was originally listed on 7th July 2016, which was declared a holiday on account of Id-ul-Fitr. The petition is, with the consent of parties, taken up for final hearing today. 2. This is the second round of litigation by the Petitioner, M/s. J .....

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ciation from Indonesia do not satisfy the criteria and should be denied the benefit of preferential custom duty. The said Circular directed the Assessing Authority to disregard certificates issued by the statutory authorities in Indonesia and the confirmation given by the government- owned companies in Indonesia. This Court also quashed a consequential order dated 20th January 2016 issued by the Assistant Commissioner of Customs (Respondent No. 2 herein) requiring importers of gold jewellery fro .....

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pronounced, i.e., 27th April 2016, the Petitioner submitted a letter to Respondent No. 2 seeking release of the consignment of gold jewellery imported by it from Indonesia without being asked to furnish a BG for 100% of the differential duty. Thereafter the Petitioner sent reminders on 10th, 19th, 20th and 29th May 2016. Despite this, the consignment of gold jewellery imported by the Petitioner from Indonesia under Bill of Entry ( B/E ) No. 3970620 dated 20th January 2016 and the further consign .....

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26th April 2016 of this Court. The Court then observed in its order that while that is a possible course of action for the Customs Department to take, the fact remains that as of date, it is incumbent on Respondent No. 2 to process the requests of the Petitioner for release of the imported consignments in accordance with the law as explained by this Court in its judgment dated 26th April 2016. Today, Mr. Sanjeev Narula, learned counsel for the Customs, informs the Court that an appeal is yet to .....

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the excuse that an appeal is contemplated and therefore, no action has been taken to implement the aforementioned judgment of the Court is not legally tenable in view of the decision of the Supreme Court in Union of India v. Kamlakshi Finance Corporation Limited AIR 1992 SC 711. 6. Pursuant to the above order, on 2nd June 2016 the Petitioner wrote to Respondent No. 2 inter alia making out a case for unconditional release of the consignments. The Petitioner contended that since this Court had in .....

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nuary 2016 and 4138435 dated 3rd February 2016 has been assessed provisionally on 7th June 2016 without having any influence of any circular, directions with PD Bond of an amount equal to the difference between the duty that may be finally assessed or; reassessed, and provisional duty of the value of the goods and getting deposit 20% of provisional duty in terms of Regulation 2 of Customs (PDA) Regulations, 2011 and Bank Guarantee of 50% of differential duty in terms of Regulation 4 of Customs ( .....

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the subsequent order dated 24th June 2016, the application seeking amendment was allowed and the amended petition was taken on record. 9. This Court has heard the submissions of Mr. Tarun Gulati, learned counsel for the Petitioner and Mr. Sanjeev Narula, learned counsel for the Respondents. 10. A preliminary objection has been raised by Mr. Sanjeev Narula that the impugned communication/order dated 8th June 2016 is appealable before the Commissioner of Customs (Appeals) and, therefore, this Cou .....

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omply with the said directions in letter and spirit. Despite the goods having been imported more than five months ago, they have still not been released, even on provisional basis. The Court is therefore of the view that relegating the Petitioner at this stage to the alternative remedy of a statutory available would further delay the matter and multiply litigation. The preliminary objection is therefore overruled. 12. On merits, reliance was paced by Mr. Narula on a collective reading of Regulat .....

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ount of any of the grounds specified in sub-section (1) of Section 18 of the said Act, is not able to verify the self-assessment or make re-assessment of the duty on the imported goods or the export goods, as the case may be, he shall make an estimate of the duty to be levied (hereinafter referred to as the provisional duty). (2) If the importer or the exporter, as the case may be, executes a bond in an amount equal to the difference between the duty that may be finally assessed or reassessed an .....

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it only talks of the importer having to execute a bond for an amount equal to the difference between the duty that may be finally assessed and re-assessed and the provisional duty and deposit such sum not exceeding 20% of the provisional duty. As far as Regulation 4 is concerned, it provides that the proper officer may require that apart from the bond, i.e, the importer being asked to furnish surety or security, or both, as he deems fit. In the above context, its judgment in The Bullion and Jew .....

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ion 4 and is intended to adequately secure the Revenue and ensure uniformity of provisional assessments across all ports. The said Circular does not leave the issue of what conditions should be imposed for provisional assessment to the concerned customs officer. It requires the officer to demand 100% bank guarantee even in respect of those B/Es which have been provisionally assessed under Section 18 of the Act. It certainly is contrary to proviso (a) to Section 151 A inasmuch it dictates to the .....

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and deposit of 20% of the provisional duty, a BG/cash deposit for 50% of the provisional duty, the officer concerned was only exercising his discretionary power under Regulation 4. On the other hand, it is pointed out by Mr. Tarun Gulati for the Petitioner that the gold jewellery was imported from the same Indonesian Supplier- PT Antam owned by the Government of Indonesia. The COO Certificate issued by the said PT-Antam, verifying that the jewellery had been made using gold mined in Indonesia, .....

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the Petitioner to also make a further deposit or furnish a BG for 50% of the provisional duty as a condition for provisional release of the goods in question. 15. In the first place, it requires to be noted that the order/communication dated 8th June 2016 does not give the reasons for requiring the Petitioner to deposit or to furnish a BG for 50% of the provisional duty for release of the goods pending finalization of the assessment. 16. Mr. Narula sought to suggest that although the order date .....

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for 50% of the provisional duty, must itself set out the reasons for such a decision. In other words, the requirement of the law is not satisfied if the reasons are not contained in the order communicated to the Petitioner but in the file notings which are not communicated. The inescapable conclusion is that the impugned order dated 8th June 2016 to the extent of requiring the Petitioner to furnish a BG for 50% of the provisional duty in terms of Regulation 4 of the CPDA Regulations is without r .....

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ditions imposed for provisional release of imported goods under the CPDA Regulations, the Supreme Court in Commissioner of Customs v. Navshakti Industries Pvt. Ltd. 2011 (269) ELT A146 (SC) modified this Court's order and permitted provisional release on the importer furnishing a BG for 30% of the differential duty. In Zest Aviation Pvt. Ltd. v. Union of India 2013 (289) ELT 243 (Del), this Court modified the conditions imposed for provisional release of imported aircraft by requiring the im .....

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