2025-VIL-1133-CESTAT-BLR-CU
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CUSTOMS CESTAT Cases

Customs - Provisional Release of seized goods, Re-export, Customs Act 1962 – The consignment, after being granted 'out of charge', was withheld and subsequently seized by Customs due to discrepancies in description and the presence of goods requiring specific licenses – The Appellants claimed an inadvertent error by their foreign supplier and requested re-export, which was denied. The importer's application for provisional release was also rejected by the adjudicating authority. During the pendency of the appeal against this rejection, the Customs Department issued SCN covering all charges related to the seized consignment and initiating formal adjudication proceedings - Whether an appeal challenging the denial of provisional release and re-export of seized goods remains maintainable and requires examination on merits when a detailed Show Cause Notice has been issued by the Department - HELD - The issuance of a detailed Show Cause Notice, which formalises all charges against the appellant regarding the specific consignment, fundamentally alters the procedural stage of the dispute. The entire matter, including the legality of the import, the propriety of the seizure, and the final determination of whether the goods should be released, confiscated, or allowed for re-export, is now subsumed within the scope of the adjudication proceedings initiated by that notice. Consequently, examining the prayer for provisional release at the appellate stage becomes redundant, as the primary issues will be decided by the competent adjudicating authority based on the Show Cause Notice. The appropriate remedy for the appellant is to address all contentions and seek relief within the framework of the ongoing adjudication process - The appeal was disposed of as infructuous, with the direction that the appellant should participate in the adjudication proceedings initiated by the SCN – Ordered accordingly - Whether seized goods can be provisionally released to a party claiming ownership, pending final adjudication, when the said goods are part of a Show Cause Notice issued to another party who has disowned them - HELD - Since the noticee in the Show Cause Notice had disowned the goods and the appellant was the sole claimant who had established a reasonable correlation for a substantial portion of the goods through documentary evidence, their claim could be considered for provisional release. To balance the interests of the revenue and the claimant pending final adjudication of ownership, the goods could be provisionally released - The release was made conditional upon furnishing a bond equivalent to the value of the goods. For items that required regulatory licenses or permissions, their release was further subject to the production of such requisite documents - The order rejecting the release is set aside, and the goods were ordered to be provisionally released against a bond for their value, with the additional requirement of producing necessary licenses for restricted goods, pending the final adjudication of the SCN.
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