TMI Blog2017 (1) TMI 1351X X X X Extracts X X X X X X X X Extracts X X X X ..... e, despite, the petitioner's letter dated 08.06.2016, 17.06.2016, 24.02.2016 and 29.03.2016; though, I must note that in the letter dated 24.02.2016, as per the assertions made in the counter-affidavit by the respondents, the terminology used by the petitioner was, he be given permission to re-export the goods, as against seeking permission to export the goods - the continued detention of the subject goods is illegal. Therefore, the petitioner, in my opinion, should be handed over the custody of the subject goods. What are the terms, on which, the petitioner be allowed release of goods? - Held that: - the goods can be released to the petitioner, upon a personal bond being furnished by him, whereby, he will undertake to pay fine and penalty, if found payable, upon adjudication by the appropriate forum. Petition allowed - decided in favor of petitioner. - W. P. No. 36866 of 2016 - - - Dated:- 19-1-2017 - The Honourable Mr. Justice Rajiv Shakdher For the Petitioner : Mr.G.Derrick Sam For the Respondents : Mr.G.M.Syed Nurullah Sheriff Standing Counsel ORDER 1. This is a writ petition filed for issuance of a writ of Mandamus or, any other order or, direction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , with regard to composition, description, GSM and more particularly, as to whether the subject goods, i.e., carpets were hand knotted or woven. 3.4. It appears that the respondents also summoned, one, Shri.S.Rajagopalan, the Managing Partner of M/s.All Win Shipping Services, for recording his statement under Section 108 of the Act. Mr.S.Rajagopalan, was, evidently, summoned, on account of the fact that he had acted as the Customs Broker for the petitioner. 3.5. This apart, the statement of the Proprietor of the petitioner, i.e., Kalpesh B. Patel, was also recorded on 15.062016, 16.06.2016, 25.06.2016 and 26.06.2016. 3.6. I may only record that, on the other hand, the respondents' stand is that the petitioner's statement was recorded on 29.12.2015, 25.05.2016 and 26.05.2016. 3.7. In the interregnum, though, i.e., on 17.06.2016, the petitioner claims that he received information, for the first time, that the subject goods were seized via a Seizure Mahazar, dated 11.02.2016. The reason, given by the respondents for seizure of the subject goods, was that there was mis-classification and over invoicing of the subject goods by the petitioner. 3.8. I must note here ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whereby, the petitioner sought provisional release of the subject goods. 5.2. The facts pertaining to aforementioned letters emanate from the assertions made by the respondents in paragraph 8 of the counter-affidavit. 5.3. According to the respondents, the first letter dated 24.02.2016, was not replied to, as according to them, and perhaps, rightly so, the request was meaningless, as there was no event of import, which had occurred in the first place, and therefore, was no question of granting permission for re-export. 5.4. Insofar as the second letter was concerned, the respondents, vide their letter dated 19.05.2016, informed the petitioner that his request for provisional release of subject goods had been denied by the competent authority, as it involved a fraud, as contemplated under Para 2.2(c)(iii) of Chapter XV of Customs Manual. 6. The petitioner, however, being aggrieved, and, perhaps, re-energized by the liberty given by this Court, filed the instant petition on 18.10.2016. 6.1. On 21.10.2016, Hon'ble Mr.Justice T.S.Sivagnanam, issued notice in the writ petition. Pursuant to issue of notice, as indicated above, a counter-affidavit was filed by the resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uate levy, seeking security under Section 110-A of the Act, even before issuing a show cause notice. (vi).The period of issuance of show cause notice of six (6) months under the provision of Section 110(2) of the Act, can be extended, by a further period not exceeding six (6) months by the Commissioner of Customs, upon sufficient cause being shown in that behalf. In support of this submission, learned counsel relied upon the judgment of the Kerala High Court in the matter of M.Mohammed V. Collector of Customs and Commissioner of Excise, Cochin, 1999 (110) E.L.T. 451 (Ker.). (vii).Furthermore, reliance was also placed by the learned counsel for the petitioner on the following judgements : (1) Santosh Handloom V. Commissioner of Customs (Import), 2016 (331) E.L.T. 44 (Del.) and (2) Sree Rajendra Textiles V. Commissioner of Customs, Tuticorin, 2012 (280) E.L.T. 21 (Mad.) 7.2. On the other hand, Mr.Sheriff, submitted that the subject goods could not be released to the petitioner, as there was mis-declaration, both with regard to, description, as well as value of the subject goods. The contention was that the subject goods have been declared as hand knotted wo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... p, by issuing the show cause notice within the prescribed time limit. In support of his submission, counsel for the respondents, like the counsel for the petitioner, relied upon the CBEC's circular dated 04.01.2011. Specific emphasis was laid by the counsel for the respondents on Clause 4 of the said Circular. 8. Having heard the learned counsel for the parties and perused the record, according to me, the first question, which arises for consideration, is : as to whether detention of goods is similar to seizure. 8.1. Pertinently, the Act does not define either terms, i.e., detention, or, seizure. Therefore, one may have to look to the dictionary meaning to ascertain the meaning in the context of the statute, with which, one is concerned with, for the moment. The Dictionary meaning of the word detention would be : the action or state of detaining or being detained (See Concise Oxford English Dictionary, Tenth Edition, Revised, page No.390). Whereas, seizure means : the act or an instance of taking possession of a person or property by legal right or process . 8.2. Ordinarily, the word detention applies to person and not goods. However, in the context of the sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se to the aforesaid letters, vide this office letter dated 19.05.2016, the petitioner was informed that his request for provisional release of the goods had been processed, and the same was denied by the Competent Authority as the case fell under Para 2.2(c)(iii) of Chapter XV of Customs Manual, as the case involves fraud. 8.8. In my view, the said provision, that is, para 2.2.(c)(iii) of Chapter XV of the Customs Manual, has to be read along with the circular. 9. Quite clearly, fraud, if at all, as allegedly committed by the petitioner, pivots around the allegation of the respondents that the petitioner had declared the subject goods as hand knotted woolen carpets , whereas, enquiries had revealed that they were hand woven carpets . 9.1. This apart, the respondents have also charged the petitioner with mis-declaring the value; though, this charge, to my mind, would be related to the first charge, which involve mis-declaration as to the nature of the goods. 9.2. CBEC's circular dated 04.01.2011 takes into account these very circumstances, and advises the customs authorities to ensure that inordinate detention of seized goods, leads to delays in fulfillment of ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... portation. (a) In case the export goods are found to be mis-declared in terms of quantity, value and description and are seized for being liable to confiscation under the Customs Act, 1962, the same may be ordered to be released provisionally on execution of a Bond of an amount equivalent to the value of goods along with furnishing an appropriate security in order to cover the redemption fine and penalty. (b) In case the export goods are either suspected to be prohibited or found to be prohibited in terms of the Customs Act, 1962 or ITC (HS), the same should be seized and appropriate action for confiscation and penalty initiated. (c) In case the export goods are suspected of mis-declaration or where declaration is to be confirmed and further enquiry / confirmatory test or expert opinion is required (as in case of chemicals or textiles materials), the goods should be allowed exportation provisionally. The exporters in these cases are required to execute a Bond of an amount equal to the value of goods and furnish appropriate security in order to cover the redemption fine and penalty in case goods are found to be liable to confiscation. In case exports are made under an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in view of the fact that the re-determined price of the subject goods was less than the duty draw back, which the petitioner had claimed. 11.3. As indicated above, the re-determined value of the subject goods, according to the respondents, was a sum of ₹ 24,93,291/-, whereas, the duty draw back, which, the petitioner had claimed was a sum of ₹ 27,12,946/-. The said amount had been claimed by the petitioner by way of duty draw back, based on the value of the subject goods being pegged, by him, at ₹ 3,10,30,857/-. Therefore, in my view, as to whether or not Section 76(1)(b) of the Act would be applicable, would be an issue that would arise during adjudication proceedings, which, the respondents are required to carry out, pursuant to the issuance of show cause notice dated 05.08.2016. 11.4. Apart from anything else, it would depend upon the concerned adjudicating forum accepting the respondents stand with regard to the value of the subject goods. 12. Therefore, only other aspect, which would arise at the moment, is as to whether the petitioner should be asked to furnish a security for fine and penalty. 12.1. Given the circumstance that the respondents ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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