Madras HC Permits Re-Export of Misclassified Textile Fabric Imports Pending Adjudication on Bond and Bank Guarantee [Read Order]
Madras HC allows re-export SQM of misclassified textile fabric from China, directing execution of a bond and 20% bank guarantee pending Customs adjudication.
The Madras High Court allowed the petitioner to re-export 303114 SQM of Textile Fabric Coated with Plastic imported from China, subject to the execution of a bond for the total value of differential duty and a bank guarantee equivalent to 20% of the re-determined value, pending adjudication under the Customs Act, 1962. The Court directed that the goods be permitted for re-export within twelve days of compliance with these conditions.
The petitioner, Shaurya International, stated that the goods were imported from Haining Haoqiang Textiles Co. Ltd., China, and that the investigation authorities had taken samples which were sent to Central Revenues Control Laboratory (CRCL), New Delhi, for testing.
Based on the CRCL report, the goods were detained and subsequently seized under a seizure memo dated 18.02.2025 for alleged misclassification.
The petitioner also appeared before the investigating officer in New Delhi and was informed that the goods were liable for confiscation under Section 111 of the Customs Act. The petitioner contended that there was a long delay in the release of the goods and requested permission to re-export them to the supplier in China, who had agreed to take back the goods.
The respondents argued stating that the goods were misclassified and undervalued, making them liable for confiscation under Section 111, and that adjudication was pending.
After considering the submissions and relying on earlier High Court judgments, including Sankar Pandi v. Union of India (2001), the Court noted that retention of the goods in India was not necessary and that the petitioner could be permitted to re-export the goods, provided certain conditions were fulfilled to safeguard the revenue.
The Bench comprising Justice N. Anand Venkatesh directed that the petitioner execute a bond for the total value of the differential duty payable and furnish a bank guarantee equivalent to 20% of the re-determined value. Upon compliance with these conditions, the petitioner was permitted to re-export the goods within twelve days.
The writ petition was disposed of accordingly.
The petitioner was represented by A.K.Jayaraj, while R.P.Pragadish along with J.Harikrishan appeared for the Revenue.
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