CESTAT directs Provincial Release of Goods on reduced Bank Guarantee taking into account Financial losses and damaging of Seized Goods [Read Order]

The Mumbai Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) reduced the Bank Guarantee taking into account financial losses and damaging of the Seized Goods.

The appellant, M/s. Nathi Mal Rugan Mal has filed the appeal against communication issued by the Deputy Commissioner of Customs Group conveying the provisional release of goods (Long Pepper) imported vide bill of entry under Section 110 A of the Customs Act,1962; Commissioner allowed the provisional release of goods subject to furnishing a Bond for Rs.65,79,899/- and a Bank Guarantee of Rs.30,00,000.

During the course of an investigation conducted by DRI against past imports, they have deposited Rs.70,00,000/- already. In respect of the impugned goods seized by DRI, they have paid a duty of Rs.3,52,040/- and deposited Rs.10,00,000. He submitted that the goods which are perishable in nature are lying under seizure for about two and half years now and the appellant has suffered a huge financial loss on this count. He requested that as the terms and conditions of the bond are harsh the same may be set aside.

The coram of Judicial Member, S.K. Mohanty and Technical Member P. Anjani Kumar that the appeal is maintainable under Section 129(A) of the Customs Act, 1962. The appellants claim that they have cooperated with the investigation and have deposited Rs.70,00,000 towards the duty liability, if any, that may arise on the past imports after completion of the investigation; in respect of the impugned goods also they have deposited more than Rs.13,00,000/-. They have suffered huge pecuniary losses and the goods are also damaged considerably for the last 2-3 years. Ongoing through the records of the case, we find that the appellants have been cooperating with the investigation and have deposited substantial sums during the investigation only before the passing of any formal adjudication order confirming the duty. Under the circumstances, we find that the appellant has established his bona fides. The appellants have requested to set aside the conditions of provisional release.

The CESTAT found that setting aside the same would place revenue interests in jeopardy. At the same time, we need to take into account the hardship of the appellant and the financial losses they have undergone.

The Tribunal held that the Bank amount for submission of Guarantee is fixed at Rs.5,00,000 in place of Rs.30,00,000 and the amount of Rs.65,79,899 fixed for Bond remains unaltered.