Revenue authority cannot deny provisional release of seized goods solely for non-cooperation during investigation under Section 110A

CESTAT Allahabad dismissed the appeal challenging provisional release of seized foreign origin gold and cash in a smuggling case. The tribunal held that Section 110A of Customs Act, 1962 confers a statutory right to provisional release of seized goods upon furnishing proper bond and security. The Additional Commissioner's denial based solely on non-cooperation during investigation was legally unjustified. The tribunal condemned the quasi-judicial authority's approach as acting like an investigating agent rather than implementing rule of law. The order directed copies to Chief Commissioner and Member Investigation/Customs for necessary action to prevent such practices violating judicial discipline principles.

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Issues Involved:
1. Provisional release of seized goods and currency.
2. Compliance with Section 110A of the Customs Act, 1962.
3. Judicial application of mind by quasi-judicial authorities.
4. Adherence to judicial discipline and National Litigation Policy.

Summary:

Provisional Release of Seized Goods and Currency:
The appeal filed by the revenue challenges the Order-in-Appeal No.87-CUS/APPL/LKO/2023, which allowed the provisional release of seized Indian currency and silver bullion. The Commissioner (Appeals) granted provisional release based on judicial precedents, requiring the appellant to furnish a bank guarantee and cash security.

Compliance with Section 110A of the Customs Act, 1962:
Section 110A permits the provisional release of seized goods pending adjudication, provided the owner furnishes a bond with security and conditions as required by the Commissioner of Customs. The Additional Commissioner initially denied the provisional release, citing ongoing investigations and non-cooperation by the appellant.

Judicial Application of Mind by Quasi-Judicial Authorities:
The Tribunal criticized the Additional Commissioner for acting as an agent of the investigating team rather than as a quasi-judicial authority. The Tribunal emphasized that ongoing investigations cannot justify denying the right to provisional release under Section 110A. The Commissioner (Appeals) was commended for applying judicial principles and following judicial precedents.

Adherence to Judicial Discipline and National Litigation Policy:
The Tribunal noted that the appeal by the revenue contradicted established judicial principles and the National Litigation Policy, which aims to reduce frivolous litigation. The Tribunal highlighted the importance of judicial discipline and condemned the revenue's appeal as contrary to the principles of law.

Conclusion:
The Tribunal upheld the Commissioner (Appeals)'s decision to allow provisional release of the seized goods and currency, dismissing the revenue's appeal. The Tribunal directed that a copy of the order be sent to higher authorities to prevent such practices in the future. The appeal was dismissed, reinforcing the importance of judicial discipline and proper application of the law.

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