Conditional bail in customs evasion matters linked to compounding relief and deposit of part of the compounding amount.

Bail in a customs evasion prosecution was considered against the backdrop of prior Delhi HC views treating the offence under Section 135(1)(ii) of the Customs Act, 1962 as non-bailable, the pendency of Supreme Court proceedings, and an existing compounding order granting immunity on payment of the specified amount. The Court took into account the seriousness of the alleged duty evasion, the stage of trial, prolonged custody, and the compounding arrangement, and permitted release subject to deposit of 50% of the compounding amount with the Chief Commissioner, followed by execution of bond and surety.

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Issues: Whether bail should be granted in a prosecution relating to customs and excise evasion, having regard to the earlier view that the offence was non-bailable and the pendency of compounding proceedings.

Analysis: The applicant's request for bail was considered in the light of prior Delhi High Court decisions treating the offence under Section 135(1)(ii) of the Customs Act, 1962 as non-bailable and the pendency of the Supreme Court proceedings on the issue. The Court also noted that the applicant had sought compounding of the offence and that the competent authority had passed an order granting compounding and immunity from prosecution on payment of the specified amount. Having regard to the seriousness of the alleged duty evasion, the stage of the trial, the prolonged custody, and the compounding order, the Court accepted that release could be ordered subject to deposit of a substantial part of the compounding amount.

Conclusion: Bail was granted on the condition that the applicant deposit 50% of the compounding amount with the Chief Commissioner and thereafter execute the required bond and surety.

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