Telangana HC orders provisional release of seized second-hand multi-functional printing devices under Order 2021

Telangana HC allowed petitioners' writ petitions seeking provisional release of seized second-hand multi-functional printing devices. Court held that under Order 2012, multi-functional devices were not notified items, only printers and plotters were restricted. Order 2021 subsequently added multi-functional devices to restricted goods list from 18.03.2021. However, highly specialized equipment remained exempted under clause 8 of Order 2021, with no restrictions on second-hand products. Court ordered provisional release subject to 10% bank guarantee and maintenance of customer transaction details for authorities.

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Issues Involved:
1. Legality of the seizure memo issued by respondent No. 1.
2. Provisional release of the imported consignments.
3. Applicability of the Electronic and IT Goods (Requirements Of Compulsory Registration) Orders, 2012 and 2021.
4. Classification of imported goods as restricted under the foreign trade policy.
5. Exemption for highly specialized equipment under the Order, 2021.

Summary:

1. Legality of the Seizure Memo:
The petitioners challenged the seizure memos issued by respondent No. 1, arguing that the seizure was in violation of the foreign trade policy. The goods seized were multi-functional devices (MFDs) used for printing, photocopying, and scanning, imported from UAE and Singapore.

2. Provisional Release of Imported Consignments:
The petitioners sought provisional release of the seized goods. The applications for provisional release were still pending with the respondent authorities. The petitioners argued that the goods fall under the exemption category and do not require authorization/license.

3. Applicability of Electronic and IT Goods Orders:
The petitioners referred to the Electronic and IT Goods (Requirements Of Compulsory Registration) Orders, 2012 and 2021, which exempt certain highly specialized equipment from compulsory registration. They cited decisions from the High Court and Madras High Court supporting their contention that MFDs are exempted.

4. Classification as Restricted Goods:
The respondents argued that the imported goods fall under the restricted category of the foreign trade policy and require proper authorization/license. They contended that the goods could be classified as e-waste and need to be scrutinized before any provisional release.

5. Exemption for Highly Specialized Equipment:
The court examined the foreign trade policy and the amendments to the Order, 2021, which introduced exemptions for highly specialized equipment. The court found that MFDs were not a notified item under the Order, 2012 but were included in the Order, 2021. However, the exemption clause in the Order, 2021 (Clause 8) allowed for highly specialized equipment to be exempted from registration requirements, provided they met certain criteria.

Judgment:
The court agreed with the petitioners that MFDs fall within the exempted category as per Clause 8 of the Order, 2021. The court directed the respondent authorities to pass an order on the petitioners' applications for provisional release of the goods, subject to the following conditions:
- Payment of enhanced duty amount by the petitioners.
- Quantification of duty by Customs within one week.
- Release of goods within four weeks upon payment.
- Provision of a bank guarantee worth 10% of the total price of the goods.
- Maintenance of transaction details and availability to respondent authorities.

The writ petitions were allowed, and the court ordered the provisional release of the goods. No order as to costs was made, and any pending miscellaneous petitions were closed.

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