Court sets aside differential duty demands, upholds release conditions, orders costs. Emphasizes fair action by authorities.

The court set aside the communications demanding differential duty, bonds, and bank guarantees for past imports. It upheld the provisional release conditions for goods covered by specific bills of entry and ordered the respondents to pay costs to the petitioner. The judgment emphasized the need for statutory authorities to act fairly and reasonably, highlighting the violation of natural justice principles by the respondents' actions. The petition was partially allowed, and a related Civil Application was dismissed.

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Issues Involved:
1. Validity of the communications dated 29th September 2009 and 1st October 2009 issued by the Deputy Commissioner of Customs.
2. Legality of withholding clearance of goods covered by the Bills of Entry Nos. 649199 and 650812.
3. Justification of the demand for bank guarantees and bonds related to past imports.
4. Compliance with the principles of natural justice and statutory powers.

Detailed Analysis:

1. Validity of the Communications Dated 29th September 2009 and 1st October 2009:

The petitioner challenged the communications dated 29th September 2009 and 1st October 2009, issued by the Deputy Commissioner of Customs, which demanded a bank guarantee equivalent to Rs. 88,30,137 for the two bills of entry and a bond for Rs. 15,75,33,199 for CVD and basic customs duty for past 28 bills of entry. The court was called upon to decide the validity of these communications.

2. Legality of Withholding Clearance of Goods Covered by the Bills of Entry Nos. 649199 and 650812:

The petitioner argued that the respondents had no power or jurisdiction to refuse clearance of goods covered by the bills of entry dated 26th and 27th August 2009. The petitioner had already deposited the CVD under protest and requested the release of the goods. The court noted that the respondents were withholding the clearance to pressurize the petitioner to comply with their demands, which was deemed impermissible in law.

3. Justification of the Demand for Bank Guarantees and Bonds Related to Past Imports:

The court examined the respondents' demand for bank guarantees and bonds concerning past imports covered under 28 bills of entry filed during 2009. The petitioner contended that there was no connection between the past bills and the current consignments. The court found that in the absence of a show cause notice, the demand for past imports was unjustified. The respondents' action was deemed arbitrary and illegal, as it breached the principles of natural justice.

4. Compliance with the Principles of Natural Justice and Statutory Powers:

The court emphasized that statutory authorities must act without bias and arbitrariness. The respondents' failure to issue a show cause notice and their arbitrary demands were found to violate the principles of natural justice. The court highlighted that statutory powers must be exercised with reasonableness and fairness, and the respondents' actions did not meet these standards.

Conclusion:

The court set aside the impugned communications to the extent they demanded differential duty, execution of bonds, and bank guarantees for past imports. The court maintained the conditions for the provisional release of the consignments covered by the bills of entry dated 26th and 27th August 2009. The respondents were directed to pay costs of Rs. 25,000 to the petitioner for their unjustifiable and arbitrary actions. The judgment clarified that the Revenue could take lawful action in respect of past imports if advised. The petition was partly allowed, and the related Civil Application was dismissed.

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