Seizure Memo Validated, Conditions Upheld for Goods Release, Detention Certificate Granted

The Court upheld the legality of the seizure memorandum issued by the Directorate of Revenue Intelligence, dismissing challenges to it in a writ proceeding. The conditions imposed for the provisional release of goods were deemed appropriate to safeguard revenue interests, rejecting the petitioner's request for modification. The petitioner was granted a detention certificate for waiver of demurrage and container detention charges. The Court's decision allowed the appeals filed by the DRI and Customs Department, while dismissing the petitioner's challenges, except for the issuance of the detention certificate.

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Issues Involved:

1. Legality of the seizure memorandum dated 01.12.2018 issued by the Directorate of Revenue Intelligence (DRI).
2. Conditions imposed for the provisional release of goods as per the order dated 01.01.2019.
3. Issuance of detention certificate for waiver of demurrage and container detention charges.
4. Challenge to the seizure memorandum in a writ proceeding.

Issue-wise Detailed Analysis:

1. Legality of the Seizure Memorandum:

The petitioner challenged the seizure memorandum dated 01.12.2018 issued by the DRI, questioning its legality. The Court held that a seizure memorandum is a document drawn to justify the seizure of goods and is not subject to challenge in a writ proceeding. Therefore, the challenge to the seizure memorandum was dismissed.

2. Conditions Imposed for Provisional Release of Goods:

The petitioner sought the provisional release of imported goods detained by the DRI, claiming they were of Sri Lankan origin and covered by certificates of origin under the ISFTA/SAFTA agreements. The Customs Department imposed conditions for provisional release, including furnishing a bond equal to the value of the seized goods, a bank guarantee/security deposit to cover the entire amount of differential duty, and a bank guarantee/security deposit in lieu of fine and penalty amounting to 25% of the differential duty.

The Court examined the discretion exercised under Section 110A of the Customs Act and found that the conditions imposed by the Customs Authorities in the order dated 01.01.2019 were appropriate to safeguard the interests of revenue. The Court noted that the petitioner had not established entitlement to the benefit of the exemption notification and that the matter was still under investigation. Therefore, the conditions imposed for provisional release were upheld, and the petitioner's request for modification of these conditions was dismissed.

3. Issuance of Detention Certificate for Waiver of Demurrage and Container Detention Charges:

The Court found that the petitioner was entitled to a detention certificate for waiver of demurrage and container detention charges because the consignment had been detained at the instance of the DRI for investigation. The competent authority was directed to issue the detention certificate upon the petitioner complying with the conditions in the provisional clearance order dated 01.01.2019.

4. Challenge to the Seizure Memorandum in a Writ Proceeding:

The Court reiterated that the seizure memorandum, being a document justifying the seizure of goods, cannot be challenged in a writ proceeding. The challenge to the seizure memorandum was therefore dismissed.

Conclusion:

The Court allowed W.A.Nos.329 & 355 of 2019 (filed by the DRI and the Customs Department), dismissed W.A.No.240 of 2019 (filed by the petitioner challenging the conditions for provisional release), and dismissed W.A.Nos.236 & 237 of 2019 (filed by the petitioner challenging the seizure memorandum), except for the direction to issue a detention certificate for waiver of demurrage and container detention charges subject to compliance with the provisional release conditions.

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