Karnataka High Court
M/S Pavan Enterprises vs The Chief Commissioner Of Customs on 18 August, 2022
Author: S.R.Krishna Kumar
Bench: S.R.Krishna Kumar
1
IN THE HIGH COURT OF KARNATAKA, BENGALURU
DATED THIS THE 18TH DAY OF AUGUST, 2022
BEFORE
THE HON'BLE MR.JUSTICE S.R.KRISHNA KUMAR
WRIT PETITION No.15906 OF 2022 (T-CUS)
BETWEEN:
M/S PAVAN ENTERPRISES
REP BY ITS PROPRIETOR
SHRI VINU VARGHEESE
EP-V867A, EPPIKKAD
POST EDAPATTA,MALAPURAM DT
KERALA-679 326.
...PETITIONER
(BY SRI. ARUNA SHYAM., SENIOR ADVOCATE FOR
SRI. SUYOG HERELE.E., ADVOCATE)
AND:
1. THE CHIEF COMMISSIONER OF CUSTOMS
BENGALURU CUSTOMS ZONE
C R BUILDING, QUEENS ROAD
BANGALORE-560001.
2. THE COMMISSIONER OF CUSTOMS(APPEALS)
BENGALURU, 4TH FLOOR, BMTC BUILDING
ABOVE BMTC BUS STAND
OLD AIRPORT ROAD,DOMLURU
BENGALURU-560 071.
3. THE JOINT COMMISSIONER OF CUSTOMS
O/O THE ADDITIONAL COMMISSIONER OF CUSTOMS
BENGALURU CITY CUSTOMS COMMISSIONER
INLAND CONTAINER DEPOT, WHITE FIEDL
BANGALORE-560 066.
...RESPONDENTS
(BY SRI. JEEVAN J.NEERALGI., ADVOCATE)
THIS W.P. IS FILED UNDER ARTICLES 226 AND 227 OF
THE CONSTITUTION OF INDIA PRAYING TO QUASH THE
2
IMPUGNED ORDER/ENDORSEMENT DD 08.06.2022 IN
F.NO.CUS/AG/MISC/1019/2021-TECH-IC-WHITEFIELD PASSED BY
THE R3 THEREBY REJECTING THE APPLICATION FILED BY THE
PETITIONER SEEKING PROVISIONAL RELEASE OF DE-STUFFED
IMPORTED PERISHABLE GOODS (PRODUCED AT ANNEXURE-A)
AND ALLOW THE APPLICATION FILED BY THE PETITIONER AS
PRAYED FOR BY DIRECTING THE R3 TO RELEASE THE
CONFISCATED DE-STUFFED IMPORTED GOODS UNDER BILL OF
ENTRY NO.9288853 DTD 23.10.2020 CONSISTING OF DEFATTED
COCONUT CLASSIFIED AS TARIFF ITEM/CTH 23065020
FORTHWITH AND TO ISSUE DEMURRAGE WAIVER CERTIFICATE
TO THE PETITIONER PRODUCED AT ANNEXURE-V
THIS W.P. COMING ON FOR ORDERS THIS DAY, THE
COURT MADE THE FOLLOWING:-
ORDER
In this petition, petitioner has sought for the following reliefs:-
" (i) Issue a Writ in the nature of Certiorari or any other writ and quash the impugned order/endorsement dd 08.06.2022 in f.no.cus/ag/misc/1019/2021-Tech-Icd-Whitefield passed by the r3 thereby rejecting the application filed by the petitioner seeking provisional release of de-stuffed imported perishable goods (produced at annexure-a) and allow the application filed by the petitioner as prayed for by directing the Respondent No.3 to release the confiscated de-stuffed imported goods under bill of entry no.9288853 dtd 23.10.2020 consisting of "DEFATTED COCONUT" classified as Tariff Item/CTH 23065020 forthwith and to issue demurrage waiver certificate to the petitioner; ( produced at Annexure-V);
(ii) Issue a writ in the nature of mandamus and direct the Respondent No.3 to pay 3 costs, and damages to the Petitioner to make good the loss incurred by the petitioners.
(iii) Issue any other writ or order or direction and grant such other relief or relief(s) as this Hon'ble Court may deem fit, in the facts and circumstances of the case, in the interest of justice and equity."
2. Heard learned Senior counsel for the petitioner and learned counsel for the respondents and perused the material on record.
3. In addition to reiterating the various contentions urged in the petition and referring to the material on record, learned Senior counsel for the petitioner submits that pursuant to the order dated 10.03.2021 passed by the 2 nd respondent, the petitioner preferred a statutory appeal before the appellate authority, which allowed the same vide order dated 24.08.2021 as can be seen from Annexure-R. It is contended that subsequently, since the oral requests made by the petitioner seeking release of the seized goods were not complied with by the respondents, petitioner submitted a representation dated 03.03.2022 to the respondents calling upon them to release the goods in terms of the order dated 24.08.2021 passed by the 4 appellate authority. Since the respondents did not take necessary steps in this regard, even thereafter, the petitioner approached this Court in W.P.No.6016/2022, which was disposed of by this Court vide order dated 05.04.2022.
3.1 It is the grievance of the petitioner that subsequent to disposal of the aforesaid petition by this Court, the petitioner submitted an application dated 06.04.2022 and one more representation dated 22.04.2022 calling upon the respondents to pass an order of provisional release of goods under Section 110A of the Customs Act, 1962 and the same having been rejected by the respondents by passing the impugned order at Annexure-A dated 08.06.2022, the petitioner is before this Court by way of the present petition.
4. Per contra, learned counsel for the respondents - revenue would support the impugned order and submits that there is no merit in the petition and the same is liable to be dismissed. It is also submitted that as noticed by this Court in W.P.No.6016/2022, the respondents have 5 preferred an appeal before the Tribunal and since the same is pending, the question of adjudicating authority directing provisional release of the goods does not arise.
5. I have given my anxious consideration to the rival submissions and perused the material on record.
6. As rightly contended by the learned Senior counsel for the petitioner, in W.P.No.6016/2022 dated 05.04.2022, this Court held as under:-
" The petitioner, who has the benefit of an order in Appeal in A.No.99/2021-Cus (B-City), has sought for a direction to the second respondent to release the imported goods in Bill of Entry dated 23.10.2020 in No.9288853. It is undisputed that the controversy is because the petitioner contends that the imported goods is 'defatted coconut' and the authorities contend that it is 'desiccated coconut'. It is further undisputed that if the order in the aforesaid appeal, which would vindicate the petitioner's stand that the goods are defatted, is accepted by the authorities, the goods that are subject matter of the aforesaid Bill of Entry will have to be released forthwith to the petitioner without any condition.
However, Sri Jeevan J Neeralgi, learned counsel for the second respondent, submits that the authorities have impugned the order in appeal in an appropriately instituted subsequent appeal before the Tribunal and he also 6 submits that the petitioner, during the pendency of the proceedings before the original authority/the adjudicating authority, could have submitted a request for provisional release of the imported goods. If a request was accordingly made, the adjudicating authority could have considered releasing the goods on terms as permissible under Section 110A of the Customs Act, 1962.
Sri Arun Shyam, learned Senior Counsel for the petitioner, submits that the order in appeal is dated 24.8.2021 and to the petitioner's knowledge, the authorities have not preferred any appeal and in the absence of an appeal, the petitioner is entitled to the release of the imported goods. But, when it is pointed out that if the appeal is presently instituted and pending, the learned Senior Counsel submits that because it is so stated only now and the petitioner is yet to be served with notice of such appeals, the petitioner may be reserved liberty to approach the adjudicating authority for release of the imported goods with appropriate directions for expedited decision.
Since Sri Jeevan J Neeralgi is categorical in his submissions that if an application was filed during the pendency of the original proceedings under Section110A of the Customs Act, 1962, the adjudicating authority could have considered provisional release of the goods subject to the terms as regards security for the price of the imported goods, the question of granting liberty as now requested is considered.
If the petitioner could have availed such remedy during the pendency of the original proceedings, if there is 7 a second appeal by the authorities and if it is not contested and that there is no interim order in such appeal by the authority, this Court is of the considered view that the petitioner must be at liberty to file an application for provisional release of the imported goods and there must be an expedited decision on such application. This would ensure that the imported goods which are perishable are not lost to the detriment of the petitioner, and the revenue's interest would also be balanced. Hence, the following:
ORDER The petition is disposed of with liberty to the petitioner to file an application under Section 110A of the Customs Act, 1962 before the adjudicating authority, even without waiting for a certified copy of this order. The petitioner may file such application within a week from today. The adjudicating authority if such application is filed, shall decide on the application in the light of the provisions of Section 110A of the Customs Act, 1962 within a week from the date of the application."
7. As can be seen from the aforesaid order passed by this Court, this Court has categorically granted liberty in favour of the petitioner to file an application for provisional release of the imported goods and by directing expedited decision on such application, since the subject goods are perishable in nature. In the light of the specific direction 8 issued by this Court and liberty reserved in favour of the petitioner to file an application under Section 110A of the Customs Act, the respondents clearly misdirected itself in refusing to pass an order of release on the ground that the adjudicating authority had already passed an order against the petitioner by relying upon the order dated 31.12.2021 referred to in paragraph-3 of the impugned order, without appreciating that the same does not pertain to the adjudication proceedings in relation to the petitioner, since the same had already culminated in the order at Annexure- P dated 10.03.2021 itself, much prior to 31.12.2021. The respondents also failed to consider and appreciate that aggrieved by the aforesaid order at Annexure-P dated 10.03.2021, petitioner had preferred an appeal before the appellate authority, which had allowed the same vide final order dated 24.08.2021. Further, as noticed by this Court, aggrieved by the said order at Annexure-R dated 24.08.2021, the respondents - revenue had preferred an appeal before the Tribunal; however, there was no interim order passed by the Tribunal in the said appeal preferred by the revenue. Under these circumstances, I am of the 9 considered opinion that the respondents clearly erred in rejecting the application filed by the petitioner under Section 110A of the Customs Act.
8. It is also relevant to state that though Section 110A of the Act refers to the proceedings before the adjudicating officer, in the light of the undisputed fact that the appeal had been preferred by the petitioner and a further appeal preferred by the respondents are merely continuation of the original adjudication proceedings, the respondents clearly erred in coming to the conclusion that the provisional release under Section 110A of the Act is permissible only when the proceedings are pending before the adjudicating officer and as such, the impugned order deserves to be quashed by this Court also.
9. In the result, I pass the following:-
ORDER
(i) Petition is hereby allowed.
(ii) The impugned order at Annexure-A dated 08.06.2022 passed by the 3rd respondent is hereby quashed.10
(iii) The respondents are directed to release the subject goods in favour of the petitioner within a period of one week from the date of receipt of a copy of this order, subject to the petitioner complying with the requirement of Section 110A of the Customs Act, 1962.
(iv) It is made clear that the release of the subject goods in favour of the petitioner pursuant to this order, would be without prejudice to the rights and contentions of the parties in the appeal preferred by the revenue and the same would be subject to final outcome of the appeal.
(v) All rival contentions urged by the parties in the appeal are kept open and no opinion is expressed on the same.
Sd/-
JUDGE Srl.