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9. Mr Sanjeev Narula, learned Senior Standing Counsel for Respondent Department placed before the Court in a tabular form a detailed analysis of the contents of the consignments imported by the Petitioner under each of the five B/Es. This showed that not only was there a mis-description of the goods imported but also misdeclaration of the quantity and value in four out of five B/Es. Mr Narula further pointed out that even prohibited goods like smart phones with sim slots were sought to be 'smuggled' in through larger consignments. Although the Petitioner may be a first time importer, the type of the goods sought to be imported were such that the interest of the revenue had to be protected and in those circumstances, the conditions imposed could not be said to be harsh or unreasonable. Mr Narula pointed out that impugned order was appealable and the Court should not lightly interfere with the provisional release order under Article 226 of the Constitution of India.

10. The legal position as regards provisional release of imported goods and distinction between orders of provisional release of goods and provisional assessments was explained recently by this Court in its decision dated 19th May, 2017 in WP(C) No. 3965 of 2017 (Mala Petrochemicals and Polymers v. The Addl. Director General, Directorate of Revenue Intelligence). After discussing the earlier decisions of this Court and the Supreme Court on the topic, the Court observed:

"21. The Court finds that the distinction between the goods being released provisionally in terms of Section 110 A of the Act and provisional assessment of the goods under Section 18 of the Act read with the Regulations thereof was perhaps not acknowledged in many of the orders earlier passed by the Court. More importantly, none of these cases, as already noticed, actually dealt with the provisional release of goods that had been imported by misdeclaring them.

22. Ultimately, each case turns on its peculiar facts. There can never be a blanket rule that in all cases of misdeclaration 100% of the duty must be asked to be deposited or that if the importer is asked to do so then he cannot be asked to furnish a BG. For instance, in Malabar Diamond Gallery P Ltd. v. The Addl Dir General DRI 2016 (341) ELT 65, the Madras High Court held that although the import of gold was not prohibited, if the import was in violation of the conditions attached to such import, could amount to smuggling and that a prayer for provisional release could be refused. The decision in Sada Sukhi Electronic P Ltd v CC (Seaport-Import) 2014 (304) ELT 42 (Mad) involved misdeclared goods and the conditions imposed were the deposit of 100% of the duty on the declared value, 50% of the differential duty, and personal bond for the remaining 50%.

23. The power under Section 110 A of the Act involves exercise of discretion. The scope of judicial review is to examine if the discretion has been rightly exercised; that it is not based on irrelevant materials and is fair and reasonable in the circumstances. It is not an appellate power. The drawing of a distinction between seizure of imported goods as a result of undervaluation and seizure of imported goods upon misdeclaration cannot per se be said to be irrational. On the contrary, the failure to draw such a distinction and treat all types of wrongful imports on an equal footing might result in miscarriage of justice. That is perhaps why Section 110 A has been worded in the way it has, leaving some margin to the Customs in the exercise of their discretion subject, of course, to the recognised legal limits."