Provisional release of seized goods allowed on security where investigation was not shown to be prejudiced.

Provisional release of seized goods may be granted pending investigation where the revenue does not show that release will impede the inquiry. The department's interest can be protected through suitable security conditions, including a bond for the full value of the goods and retention of samples for examination. On that basis, the seized goods were ordered to be released to the appellant, subject to execution of the bond and furnishing of a bank guarantee.

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Issues: Whether the goods under seizure should be released provisionally to the appellant pending investigation.

Analysis: The goods had remained under seizure for about six months. The appellant asserted that the goods were meant for export and that delay in release would prejudice its export commitments. The revenue did not establish that provisional release would hamper the investigation. At the same time, the department's interest in investigation could be safeguarded by retaining samples of the goods and by insisting on security for the value of the goods.

Conclusion: Provisional release of the seized goods was ordered to the appellant on execution of a bond for the full value of the goods and furnishing of a bank guarantee for Rs. 20 lakhs, with liberty to the department to draw samples for investigation.

Ratio Decidendi: Where the revenue fails to show that provisional release of seized goods will impede investigation, release may be granted on suitable security conditions while preserving the department's right to retain samples.

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