TaxTMI 
TaxTMI 
2026 (4) TMI 1447
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....ntal investigations are far from over which need co-operation of all and this process is likely to take time. Therefore, we have to examine the request of provisional release of goods as per Section 110 A of the Customs Act, 1962 and to find out whether, the Adjudicating Authority has placed onerous conditions or not for release of goods. We find that this Section requires the Adjudicating Authority "to impose conditions for release and taking bond in proper form with such security and conditions as Adjudicating Authority may require." We therefore, find that taking of bond in proper form is essential condition and there is no discretion as far as taking the bond is concerned. The discretion of the Adjudicating Authority is available in the phrase "with such security and conditions as Adjudicating Authority may require." We therefore, find the condition of submission of bond equivalent to the value of goods i.e. Rs.1,93,77,485/- is justified. We find that the bond can also, as per Section 110A contain undertaking that on import of such goods, the duty, fine and/ or penalty as may be adjudged by the Adjudicating Authority subject to the appellate provisions under the Act, shall be p....
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....e and take a stand as if it is finally adjudicating the matter and upholding whatever duty can be alleged on completion of the investigation as having been possibly incurred. A half-baked investigation at the stage of seeking provisional release cannot be presumed to be complete so as to concur with revenue's view point in each and every case. The underlying notion while deciding provisional release by the Adjudicating Authority should be to ensure that the conditions are such that release is taken rather than goods staying back and allowed to deteriorate. The circular 35/2017 of C.B.E.C. could stand the scrutiny of Hon'ble High Court of Delhi as reported in 2021 (375) E.L.T. 545 in Additional Director General (Adjudication) v/s. Its My Name Pvt. Ltd. due to the vires being partly upheld as discretion was made available to the officers. Such discretion therefore should not be abrogated through mechanical exercise of maximum duty being sought to be secured. Afterall, "Discretion in Judging is like seasoning in cooking. A pinch is wisdom. A handful is malpractice." - Balancing the conflicting interests is therefore the key to reasonable use of Judicial discretion. 4.4 In the....
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.... of the transaction value and duty involved as may be assessed based on transaction value by the specified officer or Customs officer etc, importer shall be made to deposit 50% of the differential duty so arrived at by the Department on such quantum of goods to be moved or cleared. The specified officer will provisionally assess the duty on clearance to DTA or on movement to any SEZ/ EOU on deemed export as per classification as declared by the party. The Bank Guarantee executed for movement of goods to another SEZ unit or EOU for approved authorised operations, if any, on return shall either be returned to party or department may roll back the Bank Guarantee to the extent of goods returned to the warehouse. (4) If the party so desires, they can deposit such duty at one go i.e. 50% of the differential amount of Rs. 2,83,94,851/- or they may pay 50% of the duty worked by the Department, as and when some lot of goods or quantity is cleared. This will tantamount to allowing duty to be paid in instalment by the party at its discretion as and when it finds customers. Such deposit shall be made with the Custom authorities quoting the direction of this order and specified officer....
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....ORITIES: a) The impugned requirement for a 50% deposit on raw material is without express statutory basis in the SEZ Act when goods remain within SEZ and are used for authorized manufacturing operations; charging of duty on such intra-SEZ operations until DTA clearance is contrary to the statutory scheme and results in duplication. b) Article 265 of the Constitution (no tax without authority of law) bars levies without clear statutory backing. Principles against duplicative taxation have been recognized by higher courts (see Union of India v. Bombay Tyre International Ltd., 1984 (17) ELT 329 (SC); Vodafone International Holdings B.V. v. Union of India, (2012) 6 SCC 613). c) Recent pronouncements dealing with the SEZ regime have underscored that SEZ is to be treated as outside customs territory and that duties cannot be imposed contrary to the statutory intent - a position reflected in decisions relied upon in the Applicant's draft and impugned order which justify protection of revenue without imposing unauthorized duplicative levies. d) Case law on rectification of Tribunal orders supports correction where an oversight causes prejudice: CCE v....
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....not convert into an unauthorized multiplicity of levies. 3. The prayer was opposed by the learned Authorised Representative (AR) on the ground that there was no error apparent on the face of the record warranting any modification of the order. The learned AR also opposed the contention of the appellant that the DRI lacks jurisdiction and that action against an SEZ unit is improper. Reliance was placed on the judgment of the Hon'ble High Court of Gujarat in Union of India vs. Oswal Agricomm Pvt. Ltd., reported in 2011 (268) ELT 21 (Guj.), wherein it has been held that Customs authorities do have jurisdiction over SEZ units in cases involving violation of Customs laws. 4. We have considered the above submissions. The appellant has pleaded in their ROM application that the order did not contemplate a specific, factual or legal scenario i.e. movement of the imported raw material from SEZ warehouse to another SEZ unit, for use in the manufacturing process which results in substantial transformation and manufacture of finish goods with the changed HSN and thereafter such goods to be cleared in DTA after full payment of duty under Section 30 of the SEZ Act, 2005 and prayed for it's ....