https://www.taxtmi.com/css/info/rss_sitemap/rss_feed.css?v=1746094055 https://www.taxtmi.com Business/Tax/Law/GST/India/Taxation/Policies/Legal/Corporate Tax/Personal Tax/Vat Law/Legal Information/Tax Information/Legal Services/Tax Services Tax Management India. Com / MS Knowledge Processing Pvt. Ltd. All rights reserved. One stop solution for Direct Taxes and Indirect Taxes https://www.taxtmi.com/caselaws?id=754855 https://www.taxtmi.com/caselaws?id=754855 Interpretation of statute - section 110 A of the Customs Act, 1962 - use of word, may and not shall - applicability of clause (i) of Para 2 of Circular No.35/2017-Customs dated 16.08.2017 issued from F.No.394/13/2016-Cus (AS) - provisional release for prohibited goods - section 2(33) of Customs Act, 1962 - HELD THAT:- On perusal of the order dated 25.10.2022 passed by the appellant, which was impugned before the Tribunal, it was stated that the evidence gathered by the investigating agency indicates that the gold had been imported by certain persons without payment of customs duty subject to the condition that the imported gold will be used for manufacture of jewellery to be exported. However, it was diverted to the domestic market where it was purchased by third parties, contrary to the conditions and restrictions imposed by the Government of India. Further, it was observed by the appellant that the scale of fraud perpetrated by certain persons in import of gold for the purpose of manufacturing jewellery for export and diverting it into domestic market calls for confiscation of the gold seized from the premises of the respondent - the appellant refused to exercise the discretion conferred under the provisions of the Customs Act to release the goods provisionally. The Tribunal has got powers to interfere with the order passed by the appellant. At the same time, given the nature of violation committed by the respondent in importing gold for manufacturing jewellery for export but diverting it into domestic market, we are of the view that this is not a fit case where the Tribunal is justified in exercising the discretion conferred upon Section 110-A of the Customs Act to provisionally release the goods. The Tribunal also ignored clause (i) of part 2 of Circular No.35/2017-Customs dated 16.08.2017 wherein it was stated that provisional release of goods shall not be allowed in respect of prohibited goods as has been defined under Section 2 (33) of Customs Act, 1962. In this case, it is clear that the goods which are sought to be provisionally released, is a prohibited goods and therefore, the Tribunal ought not to have passed the order, which is impugned in this appeal. Liberty is given to the respondent to deposit the value of the seized gold as on date / as claimed by the appellant and in the event of the respondent making such payment, the appellant shall provisionally release the seized goods to them, upon imposing any other condition(s) as may be deemed fit and necessary, if the seized gold has not been sold out or auctioned. The respondent also undertakes to comply with his export obligation of exporting gold jewellery and it is open to the appellant to take appropriate action in the event of breach of any condition of Notification No.57/2000-Cus read with Circular No.27/2016 including export obligation. Appeal allowed. Case-Laws Customs Fri, 10 May 2024 00:00:00 +0530