Unstayed appellate orders must be implemented; provisional release cannot be demanded without seizure or pending adjudication.

An unstayed appellate order setting aside a customs assessment had to be given effect by subordinate authorities, and the filing of a departmental appeal did not suspend that obligation. The authorities could not refuse clearance of the imported watch on the ground that an appeal was pending. Provisional release under section 110-A of the Customs Act was also inapplicable because there was no seizure under section 110 and no pending adjudication; once the assessment order was set aside, it could not support bond and bank guarantee conditions inconsistent with the appellate order. The customs authorities were directed to release the goods in accordance with the appellate order.

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Issues: (i) whether the Customs authorities were bound to implement the appellate order setting aside the assessment and allow clearance of the imported watch, despite the department's subsequent appeal to CESTAT and absence of stay; (ii) whether provisional release under section 110-A of the Customs Act, 1962 could be insisted upon in a case where there was no seizure and the assessment order had already been set aside.

Issue (i): whether the Customs authorities were bound to implement the appellate order setting aside the assessment and allow clearance of the imported watch, despite the department's subsequent appeal to CESTAT and absence of stay.

Analysis: The appellate order had set aside the reassessment and directed assessment at the invoice price. The filing of an appeal by the department did not suspend its operation in the absence of any stay. The period for filing the departmental appeal had also expired before the benefit of the relaxation ordinance could be invoked. The principle of judicial discipline required subordinate authorities to give effect to binding appellate orders until they were stayed or set aside.

Conclusion: The authorities were bound to implement the appellate order and could not refuse clearance on the ground that an appeal had been filed.

Issue (ii): whether provisional release under section 110-A of the Customs Act, 1962 could be insisted upon in a case where there was no seizure and the assessment order had already been set aside.

Analysis: Provisional release under section 110-A applies only to goods seized under section 110 and pending adjudication. In the present case there was no seizure and no pending adjudication. Once the assessment order had been set aside, it ceased to survive and could not be treated as a basis for imposing bond and bank guarantee conditions inconsistent with the appellate order.

Conclusion: Provisional release conditions were unsustainable and could not be insisted upon.

Final Conclusion: The writ petition succeeded and the Customs authorities were directed to release the imported watch in accordance with the appellate order without insisting on provisional-release conditions.

Ratio Decidendi: An un-stayed appellate order must be obeyed by subordinate authorities, and provisional release under section 110-A cannot be invoked absent seizure and pending adjudication.

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