Power under sec 110A of Customs Act is essentially and fundamentally discretionary in nature: CESTAT

M/s Amglo Resources Pvt Ltd entered into negotiations with M/s NBJ International, Dubai for supply of ‘copper cathode’ conforming to LME Grade “A” and, in pursuance thereof, imported four consignments at ICD, Tumb and one at Jawahar Custom House, Nhava Sheva for which bill was filed for assessment and clearance along with supporting documents such as invoice, bill of lading and certificate of origin.

The conclusion by the investigators at Tumb that goods of Iranian origin had been misdeclared and under the exercise of powers vested under section 110A of Customs Act, 1962, was allowed to be released provisionally upon execution of bond for five times and furnishing of bank guarantee for 15 percent of the value of the goods.

The tribunal relied on the decision of the Tribunal in Pushpak Lakhani v. Commissioner of Customs (Preventive), New Delhi which had established the framework within which adjudicating authorities may exercise discretion after a seizure.

“The Tribunal is not required to adjudicate either finally or tentatively at the time of provisional as it is an interlocutory exercise and does not finally adjudicate any liability; the question of going into prohibited goods does not arise at the stage of provisional release. The power under section 110A of the Customs Act is essentially and fundamentally discretionary in nature; The Tribunal is competent to order provisional release and fix terms and there is no need for remand; the High Courts would interfere with an order passed by the Tribunal for provisional release of the goods only on grounds of perversity;

The tribunal on the basis of the estimation adopted by the adjudicating authority and by application of the above principles permitted the provisional release of the seized goods subject to furnishing of a bond for the value of the goods and execution of a bank guarantee of Rs. 50,00,000. Thus, the appeal was disposed of.