The Delhi High Court has warned the customs department for not following judgement directing release of bank guarantee.
The bench of Justice Prathiba M. Singh and Justice Dharmesh Sharma has observed that there is also a reply affidavit, which has been filed by the Commissioner of Customs, Calcutta in which the stand is being taken by the Department that the amount, which has been deposited by way of a Bank Guarantee, jeopardized the interest of revenue.
The bench noted a serious lapse in the said affidavit as the affidavit which does not take into consideration the judgment passed by this Court on 14th December, 2023. Such lapses ought not to be repeated.
The Petitioner had imported a consignment of gold jewellery from Indonesia and had availed the benefit of exemption Notification No.46/2011-CU dated 01st June, 2011 and Notification No.12/2012-CE dated 7th March, 2012.
According to the Petitioner, the Notifications granted benefit of NIL rate of Basic Customs Duty (BCD). The authority, however, directed the Petitioner to submit a Bank Guarantee and Bond for an amount equivalent to 100% of the differential BCD.
The order was challenged by the Petitioner and in an appeal, the goods were directed to be released, subject to accepting 20% of the duty on the imported goods along with Bond. The Bank Guarantee for the sum was furnished by the Petitioner and even the Countervailing Duty (CVD) was paid for an amount of Rs.6,67,936 and the provisional assessment was, accordingly, done on 19th July, 2016.
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The Petitioner sought finalization of the assessment. However, the same was not done, which led to filing of the writ petition. The high court in the writ petition directed to release the BG and any other monies retained forthwith subject to whatever final orders that they may choose to pass while finalizing the provisional assessment proceedings. The petitioner is also entitled to be compensated by way of payment of interest @ 6% per annum on that refund which shall commence from 17 March 2016 when the DRI shared the verification reports till such time as the monies are ultimately repaid.”
The Bank Guarantee was directed to be released along with interest at 6% per annum. However, the same was subject to final orders that could be passed by the authority after the finalization of provisional assessment proceedings.
The Bank Guarantee, as directed by the Division Bench, has not been released by the Customs Department. In the meantime, however, vide the order dated 23rd February, 2024, the final assessment order has been passed, which is assailed before this Court in this petition.
In terms of the final assessment order demands were raised and penalties were imposed on the Petitioner.
The Petitioner has made two fold submissions. Firstly, the final assessment is highly belated and hence the entire proceeding itself deserves to be quashed. Secondly, the Customs department is guilty of dereliction as the bank guarantee is not released till date.
The court while warning the customs department held that if the Bank Guarantee along with interest is not released, the official/officer concerned shall be personally responsible for the same. If that is so, the Petitioner is permitted to move an application before this Court.
Case Details
Case Title: M/S Om Gems And Jewellery Versus Deputy Commissioner Of Customs (Import)
Case No.: W.P.(C) 6218/2024 & CM APPL.25897/2024
Date: 21/01/2025
Counsel For Petitioner: Mr. Kishore Kunal, Ms. Runjhun Pare, & Mr. Jayesh Sitlani, Advs.
Counsel For Respondent: Mr. Satish Aggarwala, Sr. Standing Counsel for Indirect Taxes, Department of Revenue
