Wide Impex Vs Principal Commissioner of Customs (Import) (Delhi High Court)
Delhi High Court has observed that second proviso to Customs Section 110(2), stating that in case of provisional release, period of 6 months for SCN would not apply, is to make sure that at least seized goods are provisionally released quickly. The Court held that 2nd proviso, inserted by Finance Act, 2018, did not take away what was already available to assessee and hence the proviso was not applied retrospectively. It also held that right for release of goods might have accrued if no provisional release order was passed before 6 months from seizure.
FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT
1. The two prayers in the present petition read as under:
“a. issue a writ, order or direction in the nature of mandamus to the Respondents to unconditionally release the goods imported against bill of entry No. 4355561 dated 11.12.2017 which was detained illegally and seized on 30.01.2018 in the absence of any Show Cause Notice under Section 124 of the Customs Act, 1962 as per the provisions of Section 110(2) of the Customs Act, 1962; and/or
b. Issue a writ, order or direction in the nature of mandamus to the Respondents to provisionally release the goods imported against Bill of Entry No. 4355561 dated 11.12.2017 in compliance of the order dated 02.07.2018 passed by the Learned Customs, Excise and Service Tax Appellate Tribunal, New Delhi in Customs Appeals No. 51405 /2018- DB”
2. As far as prayer (b) is concerned, on the very first date when this writ petition was listed i.e. 1st August, 2018, the following order was passed:
“Issue notice. Sh. Amit Bansal, Advocate accepts notice. List on 17.09.2018.
In the meanwhile, having regard to the CESTAT’s order dated 02.07.2018, subject to verifying that the conditions imposed for provisional release are complied with, the respondents are directed to ensure that the goods are released provisionally within a week.”
3. It is an admitted position that pursuant to the above order the goods in question have been released to the Petitioner upon the Petitioner complying with the condition as stipulated in the order dated 2nd July, 2018 of the Custom Excise Service Tax Appellate Tribunal (‘CESTAT’). Thus, the Petitioner has furnished the bank guarantee (BG) in the sum of Rs.15 lakhs, and a personal bond (PB) for Rs.6,78,577/-.
4. As far as prayer (a) is concerned, Ms. Anjali Manish, learned counsel for the Petitioner contends that the goods were detained by the Respondents upon their arrival on 11th December, 2017. According to her the goods were illegally detained till 30th January, 2018 when a formal seizure memo was issued. Despite six months having elapsed thereafter, no Show Cause Notice (SCN) under Section 124 of the Act was issued. Therefore, in terms of Section 110 (2) of the Customs Act, 1962 (‘Act’), the Petitioner is entitled to unconditional release of goods. Ms. Manish accordingly insists that the BG and PB furnished by the Petitioner pursuant to the above order dated 2nd July, 2018 of CESTAT should now be released to the Petitioner. In support of the above contention she placed reliance on an order dated 21st February, 2019 passed by the CESTAT in Appeal No. C/53512-52513/2018-Cus.(DB) (M/s. Swees James and Jewellery v. C.C. Jaipur-I) and an order dated 3rd June, 2019 of the CESTAT, Zonal Bench, Ahmedabad in Customs Appeal No. 10497/2019 (M/s. Gastrade International v. C.C. -Kandla).
5. In reply, Mr. Harpreet Singh, learned counsel for the Respondent, drew attention of the court to the second proviso of Section 110(2) of the Act inserted by the Finance Act, 2018 with effect from 29th March, 2018.
6. At the outset it requires to be noticed that there are two significant amendments that have been made to Section 110 of the Act with effect from 28th March 2018 by the Finance Act, 2018. The wording of first proviso to Section 110(2) of the Act has been changed and the second proviso, which did not exist earlier, has been inserted. To better understand the change is depicted in the tabular form:-
