2016 (12) TMI 1106 - HC - Customs

Court clarifies terms in order directing testing of imported goods, upholds Customs Act compliance, orders release to importer.

The appeal was filed to challenge the order of a single Judge directing the Department to test detained imported goods. The Court addressed disputes over ... Release of detained goods - 86 numbers of Hot Rolled Alloy Steel Coils - Held that: - the goods cannot be detained. The purpose of detention has almost been achieved. The test results are available with the Department. What remains to be examined is, how best we can protect the interests of the Department and chances of its quick recovery of the duty, which might be levied against the importer - thus, ends of justice would be better served, by directing the appellants to release the detained goods imported through Bill of Entry No.3371951 to the respondent/writ petitioner, subject to condition that bank guarantee of ₹ 25.00 lakhs given to department, bond to be executed and also respondent/writ petitioner shall promptly participate in the enquiry, initiated pursuant to the show cause notice, dated 17.10.2016 - appeal disposed off - decided partly in favor of petitioner. Issues:1. Correctness of the order passed by a single Judge2. Detention of imported goods3. Usage of expressions in the order4. Matching of test report with standards5. Release of detained goods6. Conditions for releaseAnalysis:1. The appeal was filed to question the correctness of an order passed by a single Judge of the Court. The single Judge had directed the Department to draw samples from detained goods and subject them to testing. The Department raised a dispute regarding the usage of the expression 'finally assess the bill of entry' in the order.2. The goods imported through various Bills of Entry were cleared, except for those imported through a specific Bill of Entry. The single Judge directed the Department to draw samples from the detained goods for testing. The test report was made available to the Department, and a show cause notice was issued to the importer.3. The dispute raised by the Department was regarding the usage of the expression 'finally assess the bill of entry' by the single Judge. To avoid future controversy, the Court substituted the expression with 'act in accordance with the provisions of the Customs Act, 1962.' Other directions in the order remained unchanged.4. The importer claimed that the goods had been cleared upon payment of duty, and the classification matched the self-assessment. The Department argued that the test report did not completely match the standards, leaving the matter for the adjudicating authority to decide.5. Considering the facts and to serve the ends of justice, the Court directed the Department to release the detained goods to the importer upon fulfilling certain conditions, including providing a bank guarantee, executing a bond, and participating in the enquiry initiated by the show cause notice.6. The Court ordered the release of the detained goods subject to the importer meeting specified conditions and participating in the ongoing enquiry. The appeal was disposed of with no costs, and the related application was closed.