Tribunal remands decision on seized goods, emphasizing natural justice principles and procedural fairness.

The tribunal set aside the Additional Director General's decision denying provisional release of seized goods, citing violations of natural justice principles and lack of proper consideration in exercising discretionary powers. The matter was remanded for reconsideration, directing the authority to review the request with fairness, considering all relevant factors and providing the appellant an opportunity to present their case. An order is to be issued within a month, emphasizing adherence to statutory conditions and procedural fairness. The appeal was allowed, emphasizing the importance of reasonableness and relevance in discretionary decisions.

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Issues Involved:
1. Provisional release of seized goods.
2. Violation of principles of natural justice.
3. Compliance with statutory conditions for import.
4. Adherence to CBIC Circular No. 35/2017.
5. Discretionary powers under Section 110A of the Customs Act, 1962.
6. Test of reasonableness and relevance in discretionary decisions.

Detailed Analysis:

1. Provisional Release of Seized Goods:
The appeal challenges the communication denying the provisional release of seized goods. The Additional Director General (Adjudication) DRI Mumbai refused the request based on statutory conditions and guidelines, citing the import of CRGO steel sheets from suppliers without BIS licenses, making them non-compliant with the Steel and Steel Products (Quality Control) Orders of 2012 and 2014. The goods were deemed "prohibited" under Section 2(33) of the Customs Act, 1962, thus not eligible for provisional release as per CBIC Circular No. 35/2017.

2. Violation of Principles of Natural Justice:
The tribunal noted that the ADG did not provide an opportunity for the appellant to be heard before making the decision, which constitutes a violation of the principles of natural justice. The lack of a hearing before arriving at a conclusion on the provisional release is a significant procedural lapse.

3. Compliance with Statutory Conditions for Import:
The ADG's decision highlighted that the imported goods did not meet the statutory compliance requirements as they were imported from suppliers without BIS licenses. This non-compliance with the Steel Ministry's Orders rendered the goods "prohibited" under the Customs Act, 1962, and thus not eligible for provisional release.

4. Adherence to CBIC Circular No. 35/2017:
The ADG relied on CBIC Circular No. 35/2017, which outlines that provisional release should not be allowed for goods prohibited under the Customs Act or any other law, goods not fulfilling statutory compliance, and goods posing a threat to safety. The tribunal noted that the ADG concluded the goods needed to be absolutely confiscated without a hearing, which was against the principles of fairness and reasonableness.

5. Discretionary Powers under Section 110A of the Customs Act, 1962:
The tribunal emphasized that the exercise of discretion under Section 110A should be judicious and based on relevant considerations. The ADG's decision to deny provisional release without hearing the appellant and without proper consideration of the facts was deemed unreasonable and arbitrary.

6. Test of Reasonableness and Relevance in Discretionary Decisions:
The tribunal referred to judgments from the Hon'ble Madras High Court and Hon'ble Delhi High Court, which stress that discretion must be exercised with relevance and reasonableness. The ADG's decision did not meet these criteria, as it was made without proper consideration of the appellant's submissions and test reports.

Conclusion:
The tribunal set aside the ADG's communication dated 12.11.2021 and remanded the matter back to the original authority. The authority is directed to reconsider the request for provisional release, taking into account the test reports, policy provisions, and other submissions by the appellant. The authority must provide a reasonable opportunity for the appellant to present their case and issue a speaking order within a month from the receipt of this order. The appeal is allowed, and the order was pronounced in the open court.

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