TMI Blog2022 (6) TMI 1094X X X X Extracts X X X X X X X X Extracts X X X X ..... be liable for confiscation and, therefore, they intended to seize the said goods. The expression appear to be liable for confiscation is clearly distinguishable from the expression reason to believe which are briefly analysed. Courts have held that section 110A provides a pragmatic mechanism to facilitate provisional release of seized goods, etc., to the owner, pending adjudication, but at the same time, protecting the interest of the Revenue - Insofar the present case is concerned, the petitioner had already made an application on January 18, 2022 before the respondent No. 1 for provisional release of the goods. At the time of making the application, the exportable goods of the petitioner were yet to be seized. Though initially the goods were detained by respondent No. 1, it is now stated that the goods were subsequently seized on February 9, 2022 by the Hyderabad Customs Commissionerate. Thus, a prima facie case is made out for provisional release of the goods under section 110A of the Customs Act, more particularly, considering the fact that the goods are not included in the prohibited list - provisional release of the exportable goods of the petitioner covered by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the banks of the petitioner, being respondent Nos. 5 and 6, to attach the accounts of the petitioner, as it is alleged that the petitioner is not co-operating with the investigation carried out by the GST Commissionerate, Noida. 6. Regarding attachment of the bank account of the petitioner, we find that under section 83 of the Central Goods and Services Tax Act, 2017 (briefly, the CGST Act hereinafter), more particularly, under sub-section (1) thereof, Commissioner of GST has the power to provisionally attach bank account of a taxable person. As per sub-section (1), where during the pendency of any proceedings under section 61 or section 63 or section 64 or section 67 or section 73 or section 74 of the CGST Act, the Commissioner is of the opinion that for the purpose of protecting the interest of Government revenue, it is necessary to do so, he may, by order in writing, attach provisionally any property including batik account belonging to a taxable person in such manner as may be prescribed. Sub-section (2), however, provides that such provisional attachment shall cease to have effect after expiry of a period of one year from the date of the order made under sub- section ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rated Goods and Services Tax Act, 2017 (briefly, the I. G. S. T. Act hereinafter). Since the supply was made to respondent No. 4 within the Special Economic Zone and being a zero- rated supply, there was no payment of I. G. S. T. The supplies were made by seven bills of export, all dated December 31, 2021, for a total declared value of Rs. 8,50,47,384, details of which are mentioned in paragraph No. 7 of the supporting affidavit. The bills of export were assessed by the authorised officer of the special economic zone on December 31, 2021. 16. Grievance of the petitioner is that despite such clearance and the goods not being prohibited ones, respondent No. 1 detained the exportable goods without assigning any reason. After more than two weeks, summons dated January 17, 2021 was issued to the petitioner. As per the summons issued under section 108 of the Customs Act, 1962 (briefly, the Customs Act', hereinafter), it was mentioned that an enquiry is being conducted in connection with overvaluation of export goods. The petitioner was called upon to appear before respondent No. 1 to give evidence and to produce the documents mentioned in the summons. Despite explanation provid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppear to be liable for confiscation. The customs officers then informed that they intend to seize the said goods valued at Rs. 1.76 cores, as per valuation report of the departmental chartered engineer. However, no seizure memo has been placed on record by the answering respondents. 21. In the reply-affidavit of the petitioner, it is stated that respondent No. 1 had converted the detention into seizure only on February 9, 2022. 22. At this stage, Mr. B. Narasimha Sarma, learned counsel for the answering respondents, submits that the seizure was carried out by the Hyderabad Customs Commissionerate which is not a party to the present proceeding. 23. Be that as it may, when the writ petition was filed, the exportable goods of the petitioner were under detention at the hands of respondent No. 1, i.e., an official under the Directorate of Revenue Intelligence (D. R. I.). At that stage, there was no seizure. Seizure has taken place post filing of the writ petition and during the pendency of the writ petition. 24. Section 110 of the Customs Act deals with seizure of goods, documents and things. Entire section may not be relevant for the present purpose. Only sub-section (1) al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Customs Act. 30. At this stage, we may not labour much on this point, inasmuch we have been informed at the bar that the seizure has been made by the customs officials and not by the Directorate of Revenue Intelligence, though belatedly and post filing of the writ petition. 31. As regards the expression reason to believe is concerned, it is an expression of considerable import finding place in a number of statutes- fiscal, taxing, penal, etc. Insofar the Customs Act is concerned, we have seen that only if the proper officer has reason to believe that any goods are liable to confiscation then only he gets the jurisdiction to carry out the seizure. Though there are innumerable judgments on the plenitude of the expression reason to believe , suffice it to say that the expression reason to believe postulates belief and existence of reasons for that belief. It does not mean purely subjective satisfaction. The expression contemplates existence of reasons on which the belief is founded and not merely a belief in the existence of reasons inducing the belief. Such a belief is not to be based on mere suspicion. It must be founded upon information. The authority may act on dir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cerned, the petitioner had already made an application on January 18, 2022 before the respondent No. 1 for provisional release of the goods. At the time of making the application, the exportable goods of the petitioner were yet to be seized. Though initially the goods were detained by respondent No. 1, it is now stated that the goods were subsequently seized on February 9, 2022 by the Hyderabad Customs Commissionerate. 37. We have already noticed that the goods have been seized belatedly post filing the writ petition. Therefore, it would be wholly inequitable to relegate the petitioner to the adjudicating authority under section 110A of the Customs Act which exercise we intend to carry out at this stage of the proceeding itself. 38. From the discussions made above, a prima facie case is made out for provisional release of the goods under section 110A of the Customs Act, more particularly, considering the fact that the goods are not included in the prohibited list. 39. In the circumstances, we issue notice and direct provisional release of the exportable goods of the petitioner covered by the seven bills of export dated December 31, 2021 subject to the petitioner complying ..... 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