2020 (7) TMI 326 - AT - Customs

Tribunal adjusts bond & bank guarantee requirements, reducing excessive burden on appellant.

Shri Vishesh Jain Versus Commissioner of Customs, Kutch (Gandhidham)

The Tribunal allowed the appeal, directing the appellant to execute a bond of 100% of the goods' value and a bank guarantee for 100% of the differential ... Valuation of imported goods - Provisional release of goods - Plain White Papers in Rolls - enhancement of value without any basis - HELD THAT:- Though the DRI has seized the goods for the reason that goods were undervalued but no documentary evidence shows that from where the value was adopted as against the value declared by the appellant. Since the case is under investigation, we do not want to comment whether enhancement of value is legal or illegal. However, considering the various judgments and facts of the present case, we find that terms of bank guarantee fixed by learned Principal Commissioner at ₹ 1.6 Crore is very excessive as against the total differential duty involved ₹ 59 Lakh approx. - the goods were seized on the basis of prima facie nature of the case of undervaluation and detailed investigation is yet to be carried out. Terms and condition of bank guarantee - HELD THAT:- There cannot be a fixed criteria for the amount of security to be given along with bond for provisional release of goods and it varies from facts of each case. Therefore, considering the overall facts and circumstances of the present case, we are of the view that ends of justice will be met if the appellant execute bond of 100% value of the goods and bank guarantee for 100% of differential duty amount. Appeal allowed. Issues:Provisional release of imported goods with excessive bank guarantee, early hearing application, terms and conditions of bank guarantee, detention charges by CFS.Provisional Release of Imported Goods with Excessive Bank Guarantee:The appeal challenged an order for provisional release of imported goods subject to a high bank guarantee. The appellant argued that the value of the goods was enhanced without basis, and the bank guarantee amount was disproportionately high. Citing previous judgments, the appellant contended that the bank guarantee should be fixed at 30% of the duty amount. The Tribunal found the bank guarantee of Rs. 1.6 Crore excessive compared to the differential duty of Rs. 59 Lakhs. While the Revenue justified the amount under Circular No. 35/2017-Cus, the Tribunal held that the Circular allows discretion in setting the bank guarantee amount. The Tribunal concluded that a 100% bond of the goods' value and bank guarantee for 100% of the differential duty amount would suffice.Early Hearing Application:The appellant requested early hearing due to the perishable nature of the goods. The Tribunal granted the early hearing application, considering the urgency of the matter.Terms and Conditions of Bank Guarantee:The Tribunal analyzed various judgments cited by both parties regarding the bank guarantee amount for provisional release of goods. It noted that there is no fixed criteria, and the amount varies based on individual case facts. Ultimately, the Tribunal decided on a 100% bond of the goods' value and bank guarantee for 100% of the differential duty amount in this case.Detention Charges by CFS:The appellant raised concerns about CFS demanding demurrage and detention charges despite the goods being seized and under Supurdnama by DRI. The Tribunal ruled that this issue was not related to the impugned order and did not address it in the judgment.In conclusion, the Tribunal allowed the appeal, directing the appellant to execute a bond of 100% of the goods' value and a bank guarantee for 100% of the differential duty amount. The early hearing application was also disposed of.