Release of seized jewellery during proceedings allowed subject to bank guarantee and indemnity bond protecting departmental interest

Seized ornaments and jewellery may be released to petitioner nos. 2 and 4 during pendency of proceedings if the department's interest is secured by an unconditional bank guarantee and an indemnity bond. The assets were valued by a government-approved valuer on a current basis, and release was considered appropriate only to that extent of protection. The petitioners were allowed to apply for release while their and the assessees' ownership claims were preserved for assessment proceedings. An indemnity bond in favour of the department was additionally required to protect against future claims by other family members.

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Issues: Whether seized ornaments and jewellery could be released to petitioner nos. 2 and 4 during pendency of the proceedings, subject to securing the department's interest by bank guarantee and indemnity bond.

Analysis: The seized assets were valued on a current basis by a government-approved valuer at Rs. 2,19,34,221.30. The release was considered appropriate only after protecting the department's interest to that extent. Since the seizure related to petitioner nos. 2 and 4, they were permitted to apply for release, while preserving the contentions of the petitioners and assessees on ownership in the assessment proceedings. To guard against future claims by other family members, an indemnity bond was required in favour of the department.

Conclusion: The seized ornaments and jewellery were directed to be released in favour of petitioner nos. 2 and 4 on their application, subject to furnishing an unconditional bank guarantee for Rs. 2,19,34,221.30 and filing an indemnity bond.

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