TaxTMI 
TaxTMI 
2026 (9) TMI 1858
X X X X Extracts X X X X
X X X X Extracts X X X X
....r No. 22/2009-CUS dated 19.08.2009, which will satisfy the prayers made in the writ petition. He has also referred the order dated 24.12.2018 passed by this Court and it is urged that appropriate orders may be passed. 2. Learned Senior Standing Counsel Ms. Mehta is unable to dispute the applicability of the Circular dated 19.08.2009 to the petitioner-Company as the exemption granted therein. 3. In the present writ petition, the petitioner-Company has prayed for the following reliefs: "20. (i) To issue a writ of certiorari or other appropriate writ order or direction to quash the illegal seizure memos dated 2.7.2008 and 3.7.2008 (Annexures No. 5 & 7 respectively) and declare the same to be illegal, unauthorized by law and without jurisdiction or justification and hence liable to be vacated; (ii) To issue a writ of mandamus or other appropriate writ, order or direction to direct the respondents to release the illegally seized goods forthwith to enable the petitioners No. 1 and 2 either to clear the goods for home consumption under exemption to 100% EOU, without any liability to duty, fine, penalty or interest or to re-export the goods to be sent abroad by the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....., there is a slight difference in the value worked out by both the sides: according to the respondents the said figure is about Rs. 47 lacs (Rupees Forty seven lacs), while according to the said figure is about Rs. 30 petitioner lacs (Rupees Thirty lacs). Hence, without expressing any opinion and entering into any discussion as to which is the correct figure, on the basis that the figure stated by the learned Counsel for the respondent authorities is correct, the petitioner is directed to allocate a sum of Rs.47 lacs out of the bond of Rs. 100 crores, stated to have been furnished by the petitioner, towards such liability that may arise in future, if any. The petitioner shall not take any benefit or utilise the said portion of the bond for any other purpose till final outcome of the petition. Upon the petitioner depositing the aforesaid sum of Rs.20 lacs (Rupees Twenty lacs) the aforestated goods shall be released. 3. In relation to goods seized on 2.7.2008 lying in custody of Customs Authorities the respondent authorities shall appoint an expert to ascertain as to whether the said consignment of goods contains any seconds or defective material and the report of the said ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... under the proper assessment procedure and applicable exemption. The petitioners have been all along claiming that imported goods were exempted from the payment of import duties under the Custom Notification No. 52/2003, as exported goods were used in connection with export, be it raw-material, half finished or otherwise, the seizure thereof was unfortunately not warranted under the provisions of Section 110 of the Customs Act. 2. In view of the aforesaid challenge, this Court issued notice way back on 6.10.2008, which was made returnable on 15.10.2008. The Court while issuing notice did record in its order that the action of seizure by the authority was without any authority of law and the petitioner was made to suffer greater hardship on account of illegal seizure. 3. It is not out of place to make mention of the fact that under order dated 15.10.2008, this Court after adverting to the essential basis for exercising power under Section 110(1) of the Customs Act, directed the respondent no. 3, who was deponent of the affidavit to keep original files ready for perusal of the Court for limited purpose as mentioned in that order. The said file was accordingly brough....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tyseven lacs), while according to the petitioner the said figure is about Rs.30 lacs(Rupees Thirty lacs). Hence, without expressing any opinion and entering into any discussion as to which is the correct figure, on the basis that the figure stated by the learned Counsel for the respondent authorities is correct, the petitioner is directed to allocate a sum of Rs.47 lacs out of the bond of Rs.100 crores, stated to have been furnished by the petitioner, towards such liability that may arise in future, if any. The petitioner shall not take any benefit or utilise the said portion of the bond for any other purpose till final outcome of the petition. Upon the petitioner depositing the aforesaid sum of Rs.20 lacs (Rupees Twenty lacs) the aforestated goods shall be released. 3. In relation to goods seized on 2.7.2008 lying in custody of Customs Authorities the respondent authorities shall appoint an expert to ascertain as to whether the said consignment of goods contains any seconds or defective material and the report of the said expert shall be placed on record. 4. Supplemental affidavit along with annexures, if any, to be tendered by the respondent authorities....
X X X X Extracts X X X X
X X X X Extracts X X X X
....isposed of. 8. We would have accepted such a submission but on close perusal of the show cause notice dated 22.12.2008, we come across certain allegations touching upon the factual aspect, which the petitioner's counsel suggested to be either of no significance or without any basis but we were of the opinion that when the respondents are before the Court and when the counsel for the respondent despite taking instructions, could not controvert the fact of circular dated 19.8.2009, would squarely be applicable to the facts of present case. It was most appropriate that the respondent no. 3, by way of an affidavit, explain as to how and in what manner the show cause notice impugned in this petition now can survive in light of the circular dated 19.8.2009. The said affidavit, if any, be filed on or before 15.01.2019. In case if there is no reply from the respondent on the record, the Court will left with no other option but to accept the say of petitioner's counsel that the circular has put at rest of the controversy and show cause notice shall pail into insignificance and nothing survives in the petition and petition be disposed of with all consequential reliefs. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....vant portion of the circular is as under: "2. The issue has been examined. It is viewed that there may not be any difficulty in allowing duty free import/domestic procurement of raw materials common for the manufacture/production of finished goods as well as for the manufacture of capital goods for use within the unit. The usage of inputs, imported or procured domestically, for manufacture of finished goods is allowed as per Standard Input Output norms (SION) [condition (d) (I) (ii) of opening paragraph of notification No. 52/2003-Cus dated 31.03.2003]. 3. Raw materials for making capital goods for use within the unit is allowed vide SI. No. 16 of Annexure-I of notification No. 52/2003-Cus dated 31.03.2003. Capital goods manufactured out of duty free inputs for use within the EOU are required to be accounted for and bonded as per the usual bonding procedure. While following the into-bond procedure, the value of such capital goods would be assessed by following the computed value method in terms of the Customs valuation Rules, which would inter alia account for the raw material captively consumed in manufacture of capital goods. Such goods would be liable to duty a....