9911796707
TMI Blog2022 (9) TMI 447X X X X Extracts X X X X X X X X Extracts X X X X ..... and Service Tax Appellate Tribunal, West Zonal Bench, Mumbai (CESTAT), whereby the CESTAT has ordered the provisional release of the seized goods in the shape of iPhones in purported exercise of powers under Section 110A of the Act. 2. As against the six questions proposed, we admit the present appeal on the following substantial question of law: A. Whether the Hon'ble CESTAT misread, misinterpreted and grossly erred in allowing the provisional release of the goods in favour of the the Respondent in contravention of Section 110 A of the Customs Act, 1962 when the Respondent's ownership of such goods itself is seriously disputed? 3. The appeal is taken for final disposal. 4. Briefly stated material facts are as under: Based upon the in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on M/s. D System's (HK), Hong Kong SAR as falsely claimed by Shri Dinesh Salecha. Therefore, I agree that the question for provisional release of seized goods does not arise." At this stage it becomes relevant to reproduce Section 110A of the Act, which reads as under: "110A. Any goods, documents or things seized [or bank account provisionally attached] under section 110, may, pending the order of the [adjudicating authority], be released to the owner [or the bank account holder] on taking a bond from him in the proper form with such security and conditions as the [adjudicating authority] may require.]" 6. An appeal was preferred by the Respondent before the CESTAT, which was allowed by virtue of the order dated 23rd June, 2022 impugned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... implication is clear: ownership is claimable at any stage and is, by default, attached to 'importer' which may be alienated by declaration but does not foreclose reassertion of ownership. It is not open to customs authorities to determine lack of ownership except in circumstances of rival claim and, that too, for the limited purpose of clearance of goods. 30. The goods have been seized under Section 110 of Customs Act, 1962 and the seizure itself is not in dispute before us. Therefore, it does not lie in our jurisdiction to set aside the seizure. However, appellant has claimed that the goods were wrongly dispatched to the importers and must, therefore, be returned to the owners. It is on record that the goods are not configured for use i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ition, it was submitted before the Court that the said seized consignment was mistakenly sent to India instead of Dubai by the Supplier based in Hong Kong. It was thus urged that the Respondent having denied ownership of the seized goods could not in law, seek the release of the seized goods provisionally, which could otherwise be released only in favour of the owner. It was vehemently urged that the Respondent was a master mind for smuggling iPhones in India and had created a syndicate for smuggling iPhones and the delivery through imports made by M/s Salecha Electronics Inc and M/s 2000 Semiconductor. It was urged that allowing the release of smuggled iphones in favour of the Respondent, ownership whereof had all along been denied, especi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y issue a supplementary notice under such circumstances and in such manner as may be prescribed.] 10. On a perusal of the provision (supra) it can be seen that issuance of a show cause notice in terms of Section 124 does not necessarily establish that the person in whose name it is issued, is necessarily the owner. The phrases 'penalty on any person' and 'the owner of goods or such person' suggests that before an order of confiscation is passed, an owner or any other person shall have to be given a notice of the proposed confiscation of goods. Therefore, the mere fact that a show cause notice has been issued in the name of the Respondent does not necessarily imply that he is to be treated as an owner of the goods seized, which are sought t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he person from whose custody such goods have been seized, an option to pay in lieu of such goods, such fine as the said officer thinks fit. It thus goes to show that goods can be got released by a person other than an owner, in the circumstances as envisaged in Section 125 of the Act at a time when confiscation is authorised, which right of release of goods is not available to any other person except an owner as envisaged under Section 110A of the Act at any preliminary or intermediate stage. In our opinion, in view of the specific and clear mandate of Section 110A, goods could have been permitted to be released only in favour of an owner and since the Respondent had failed to prove ownership over the goods in question, as held by the adj ..... X X X X Extracts X X X X X X X X Extracts X X X X
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