TaxTMI 
TaxTMI 
2016 (9) TMI 1089
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....wing the due process of law. The Writ Petition has been amended and prayer clauses c(1) to c(3) read as under:- "(c-1) this Hon'ble Court be pleased to issue a writ of certiorari or a writ in the nature of certiorari or any other appropriate writ/order/ or direction calling for the records relating to the seizure of the Petitioners goods on 4th August 2016 and 9th August 2016 under panchanamas at Exhibit "K" to Exhibit "M" respectively hereto and after considering the legality and validity thereof be pleased to quash and set aside the impugned orders of seizure. (c-2) this Hon'ble Court be pleased to issue a writ of certiorari or a writ in the nature of certiorari or any other appropriate writ/ order or direction calling for the records calling to the orders for provisional release dated 17th and 18th August 2016 at Exhibit "O" and Exhibit "P" respectively hereto and after considering the legality and validity thereof be pleased to quash and set aside the condition of furnishing of bank guarantee for release of the said seized goods. (c-3) this Hon'ble Court be pleased to issue a writ of mandamus or a writ in a nature of mandamus or any other ....
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....dule to the Customs Tariff Act, 1975, respectively. The petitioners have also been duly discharged from Service Tax liability under reverse charge mechanism, in terms of the Finance Act, 1994, as amended. The petitioners state that at no point of time and earlier to March 2016, any objection has been raised by the respondents. 4 However, during March, April - 2016, there were certain investigations and the petitioners were called upon to furnish the information. The petitioners refer to certain communications and then urge that on 15 June, 2016, they duly submitted the detailed information sought by respondent No.3. The petitioners rely on past practice and state that their consignments of set-top boxes were stored in a custom bonded warehouse. They filed certain bills of entry and the details of all these are to be found in paragraph 22 of the Writ Petition. The petitioners, thereafter, through its representatives personally inquired as to why further steps were not allowed to be taken and it was then revealed that the petitioners' representative was summoned for a statement to be recorded. The petitioners' representative was asked repeatedly whether the licence fee sho....
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....eared by the petitioners for home consumption. The petitioners made an application for provisional release of these goods. They pointed out that the present dispute was a pure valuation dispute, the entire seizure was unreasonable as the disputed additional Customs Duty amounted to only Rs. 53,38,212/- in respect of the seized goods, whereas the Customs Department has seized the goods worth Rs. 52,79,52,015/-. The set-top boxes were imported with a view to implement the Government policy regarding digitalization of the cable industry in the rural areas. The petitioners, therefore, pray that a provisional release order was to be passed. However, as assured before this Court the orders were made against a bond of the redetermined value of the seized goods and a Bank Guarantee of 25 % of the redetermined value which include the licence fee @ US$ 0.525 per unit of set-top boxes without exemption benefit. It is, this provisional order, which now is challenged in these proceedings. 6 It is the case of the petitioners that by these orders, though provisional release of the seized set-top boxes is permitted, the condition imposed for such release is arbitrary, unreasonable and unfair. N....
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....letter dated 6 August, 2016 addressed by DRI, Mumbai Zonal Unit to the Commissioner of Customs. 9 Our attention is also invited to the additional affidavit in reply to the amended petitions and particularly paragraph 9 thereof. Mr Shroff would submit that his contentions as noted above, stand supported by this stand of the respondents, in particular DRI. For these reasons, he would submit that the Writ Petitions be allowed and the nominal condition which has been imposed in several such instances by Delhi High Court and Punjab & Haryana High Court, be imposed. Mr. Shroff has also relied upon an order passed by the Honourable Supreme Court of India in the case of Navshakti Industries Pvt. Ltd. Vs. The Commissioner 2011(267) ELT Case Law Times, 483 which upholds the view taken by Delhi High Court in a LPA. That SLP is disposed of on 4 May, 2011 being Civil Appeal No.3940 of 2011. 10 Mr Jetly appearing on behalf of the respondents would submit that the petitioners' request is premature. This court cannot decide the issue on merits and at the stage of provisional assessment or provisional release of goods. Mr Jetly justifies imposing of the conditions by submitting that the p....
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....l Customs Duty also pro-rata, as and when the goods are cleared. 13 The petitioners would also be ready and willing to furnish the Bank Guarantee of 30 % on the differential duty of licence fee. The petitioners are aggrieved and dis-satisfied with the condition of furnishing the Bank Guarantee of 25 % of the re-determined value which include licence fee if paid / payable @ 0.252 % of the set-top boxes with exemption benefit under Notification No. 21 of 2012 dated 17 March, 2012. In that regard it is not necessary to express any final opinion at this stage. The Writ Petitions are filed at the stage of provisional release of seized goods. It would not be appropriate, therefore, on our part to express any opinion on the rival contentions, though the parties have addressed us extensively. 14 The petitioners have, after amendment of the petitions, also filed additional / further affidavits. The petitioners complain that in the garb of drawing samples, the entire consignment at Kalamboli and Uran have been seized. The consignment is of set-top boxes which are valued Rs. 4 Lacs and above. They are required for fulfilling the obligation and in terms of policies of the Central Governm....
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....boxes are meant for retail sale, then, huge quantity of the settop boxes, stored at these Customs Bonded Warehouse were seized and that is how the DRI became aware of the alleged illegal activities. 17 We are of the firm opinion that it is only on the investigation being concluded and appropriate steps taken, that the authorities can issue a show cause notice and demanding amounts now styled as a Customs Duty on the licence fee. That payment, according to the petitioners, cannot be taken into account. The petitioners are relying on the principle that what is really embedded and as claimed, are not goods but it is intellectual property services. They are relying on the payment of Service Tax and in that regard, we do not think that the DRI could have proceeded on the footing and in the facts and circumstances of the present case that there is a definite evasion. It is their duty to bring such cases of alleged evasion to the notice of the customs, which they have after the outcome of the investigation, whenever they are concluded. It is thereafter for the Commissioner of the Customs and all authorities under the Customs Act to take appropriate steps and measures. At this stage we ....