Provisional release of seized imported goods granted where the dispute was limited to customs classification and the goods were not prohibited.

Imported goods that were not prohibited and were seized only because of a customs classification dispute were held fit for provisional release, because withholding them merely due to pending investigation was not justified. The Court noted that the petitioner was a regular importer, the goods had earlier been cleared for home consumption, and the dispute turned on whether the goods fell within Chapter 98 treatment for laboratory chemicals imported in packs not exceeding 500 ml, identified by purity and markings. Provisional release was permitted on execution of a bond securing the differential duty and any consequential amount, while the classification question was left open for decision in the appropriate proceedings.

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Issues: Whether the petitioner was entitled to provisional release of the seized imported goods pending adjudication of the classification dispute.

Analysis: The goods had earlier been cleared for home consumption, the petitioner was a regular importer of the same goods, and the dispute centred on classification under the Customs Tariff. The goods were not prohibited, the seizure arose from a classification objection, and the Court noted that Chapter 98 covered laboratory chemicals imported in packs not exceeding 500 ml when identified by purity and markings. In these circumstances, and following the same approach adopted in similar matters, the Court held that withholding provisional release merely because investigation was pending was not justified. The Court also kept the classification issue open for decision in appropriate proceedings.

Conclusion: The petitioner was entitled to provisional release of the goods on execution of a bond to secure the differential duty and consequential amount, if any.

Ratio Decidendi: Where imported goods are not prohibited and the dispute is confined to classification, provisional release should ordinarily be granted on furnishing of security, leaving the classification issue to be decided separately.

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