Case Law Details
Principal Commissioner of Customs Vs Tasha Gold Pvt Ltd (Delhi High Court)
Introduction: The dispute between the Principal Commissioner of Customs and Tasha Gold Pvt Ltd over the provisional release of confiscated gold dore bars has been resolved by the Delhi High Court. This article examines the intricacies of the case, including the legal arguments and the court’s decision.
Detailed Analysis: The crux of the matter lies in the compliance of conditions set forth by the Custom Excise and Service Tax Appellate Tribunal for the provisional release of the gold dore bars. The tribunal’s decision to allow the release, subject to certain conditions, was challenged by the appellant before the Delhi High Court. The appellant contested the purity and weight specifications of the gold dore bars imported from the Republic of Rwanda, citing discrepancies in the weight and purity standards.
Furthermore, the appellant argued against the tribunal’s ruling, contending that even if the goods were found to be restricted or prohibited upon import, they should not be subject to provisional release. However, the High Court found this argument to be unfounded, stating that it was specific to the facts of the case.
The court meticulously examined the test reports and margin of error provided by the Central Revenue Control Laboratory, concluding that most of the gold dore bars failed to meet the purity requirements. Consequently, the appeal was dismissed, affirming the tribunal’s decision to allow the provisional release of the gold dore bars.
Conclusion: In conclusion, the Delhi High Court’s verdict in the case of Principal Commissioner of Customs Vs Tasha Gold Pvt Ltd clarifies the legal stance on provisional release of confiscated goods. The court’s meticulous analysis of the evidence and adherence to legal principles ensure a fair resolution to the dispute.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
1. Appellant impugns order dated 05.12.2023, passed by the Custom Excise and Service Tax Appellate Tribunal, whereby the Tribunal has permitted provisional release of 26 gold dore bars weighing 5 kg. plus, subject to the following conditions:-
“1. That the duty paid at the time of seeking release of goods of Rs. 15.20 crores approximately, even if voluntarily paid or paid under protest shall not be sought for refund by the appellants and shall available to the department till culmination of adjudication.
2. One Gold Dore Bar weighing 4.24 kg will remain available with as security and shall not be released including release for re export if sought by the party till adjudication is Apart from above security the party shall furnisha binding itself to pay equivalent of full value of consignment plus 20% in lieu of penalty thereon, to the department.
3. That the provisional release by the department, shall be done within two weeks of compliance and documentation of formalities as per para (1) and (2) above, by the appellant.”
2. Directorate of Revenue Intelligence (DRI) had issued a Notification 96/2008-Customs, providing for Preferential Tariff Scheme for import of gold from Lesser Developed Countries. A subsequent Notification No.50/2017-Customs was issued on 30.06.2017, imposing certain monetary conditions.
3. Respondent filed a Bill of Entry for import of 27 gold dore bars from Republic of Rwanda, which is one of the Lesser Developed Countries covered by the above-referred Notification 96/2008- Customs.
4. Though there are several conditions which have to be satisfied, for the subject Bill of Entry, there are two conditions which are relevant, i.e. each of the gold dorebars must weigh a minimum of 5 kgs and have a purity of less than 95% for being imported under the said Notification.
5. In view of certain inputs received by the DRI, a search at the premises of the respondent was carried out and subject 27 gold dore bars were confiscated. The contention of the DRI was that the gold dore bars did not meet the requisite specification of weight as well as purity.
6. This was disputed by the respondent in respect of 26 gold dore In respect of 1 gold dore bar, the gold dore bar admittedly weighed 4.24kgs. As per the respondent, there was no misdeclaration for the reason that the packaging of the said gold dore bar clearly mentioned that it weighed 4.24kgs. With regard to weight and purity of the remaining 26 gold dore bars, it was contended by the respondent that the gold dore bars weighed more than 5 kgs and had purity of less than 95%.
7. The gold dore bars were tested at the Central Revenue Control Laboratory (CRCL). In response to a query raised under the Right to Information Act, CRCL had responded that there was a margin of error of +/- 0.25% in testing of gold dore bars through the test method adopted by them.
8. Learned counsel submits that there were 3 gold dore bars which tested with a purity of more than 95% but were within the margin of error i.e., 95.10%, 95.26% and 95.17%.Learned senior counsel for respondent submits that the margin of error of .01% was too low for the authorities to have taken action.
9. Respondent had applied for a provisional release of the gold dore bars, however, the Principal Commissioner of Customs rejected the request for provisional release leading to the respondent approaching the Tribunal.
10. By the impugned order dated 12.2023, the Tribunal has considered the test report as well as the percentage of margin of error and thereafter directed provisional release of 26 gold dore bars weighing 5 kgs. plus.
11. Aggrieved by the said decision, appellant had approached this On 10.01.2024, noticing the earlier test reports as also the margin of error, this Court directed the appellant to have all the 26 gold dore bars weighing more than 5 kgs. re-tested.
12. Test reports have been produced and are taken on record.
13. It is noticed that 25 out of 26 gold dore bars have tested with a purity of less than 95% and 1 gold dore bar has tested with a purity of 05%, which is within the permissible margin of error of +/- 0.25%.
14. Learned counsel for Appellant submits that the Tribunal has erred in holding that even if the goods are found to be restricted or prohibited at the time of import, they would still be subject to provisional release.
15. It is held that observation of the Tribunal that even if the goods are found to be restricted or prohibited at the time of import would still be subject to provisional release, would not amount to expression of opinion and is held to be restricted to the facts of this case.
16. In view of the peculiar facts and circumstances of the case, we find that the issue is purely factual and no substantial question of law arises for consideration.
17. The appeal is accordingly dismissed. The order of the Tribunal dated 12.2023 be complied with within one week.
18. Dasti under signature of the Court Master.
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