Customs Tribunal Orders Provisional Release of Seized Gold Bullion

Case Name:

Customs Appeal No. 40518 of 2022 - M/s. Sree Venkateshwara Bullion vs. Principal Commissioner of Customs, Chennai-VII Commissionerate

Key Takeaways:

1. The appellant, M/s. Sree Venkateshwara Bullion, sought the provisional release of 3516 grams of seized crude gold bullion, claiming that the gold was duly accounted for and submitted supporting documents.
2. The Principal Commissioner of Customs (Air Cargo), Chennai, rejected the request for the release of the seized gold, citing that the gold was allegedly procured from importers who diverted imported gold to the local market, making it ‘prohibited goods’ under the Customs Act 1962.
3. The Customs Tribunal, after considering the contentions of both parties, ordered the provisional release of the seized goods, subject to conditions including the furnishing of a bond and a Bank Guarantee.
4. The Tribunal’s decision was based on the balance of convenience to ensure the Department’s interests are secured while allowing the appellant to continue its business.
5. The Tribunal’s order set aside the impugned order and disposed of the appeal on the specified terms.

Case Synopsis:

The Customs, Excise and Service Tax Appellate Tribunal, Chennai, regarding Customs Appeal No. 40518 of 2022. The appeal was filed by M/s. Sree Venkateshwara Bullion against the Principal Commissioner of Customs, Chennai-VII Commissionerate, regarding the release of seized crude gold bullion.

Here’s a breakdown of the key points in the document:

1. Parties Involved:

• Appellant: M/s. Sree Venkateshwara Bullion
• Respondent: Principal Commissioner of Customs, Chennai-VII Commissionerate

2. Background:

• The appellant is in the business of local trade of gold and silver bullion, jewelry, etc., and is registered with the G.S.T. authorities.
• On 02.02.2022, officers of the DRI conducted search and seizure operations at the premises of the appellant and seized 3516 grams of crude gold bullion.
• The appellant claimed that the seized stock of crude gold bullion was duly accounted for and submitted copies of bills/invoices on the date of search and seizure.

3. Legal Proceedings:

• The appellant approached the Hon’ble High Court through multiple Writ Petitions, and the Hon’ble High Court directed the lower authority to dispose of the request for release of goods by following the principles of natural justice.
• The Principal Commissioner of Customs (Air Cargo), Chennai, passed an order rejecting the request for the release of the seized gold.

4. Arguments and Decision:

• The appellant argued for the provisional release of the seized gold, citing Section 110A of the Customs Act 1962.
• The Revenue opposed the release of the gold provisionally and reiterated the points given in the impugned order.
• The Tribunal considered the contentions of both sides and ordered the release of the seized goods, subject to certain conditions, including the furnishing of a bond and a Bank Guarantee.

The final order was pronounced in the open court on 31.10.2023, and the impugned order was set aside, disposing of the appeal on the specified terms.

FAQ:

Q1: What was the basis for the appellant’s request for the release of the seized gold?

A1: The appellant claimed that the seized gold was duly accounted for and submitted supporting documents, seeking provisional release under Section 110A of the Customs Act 1962.

Q2: What were the grounds for the Principal Commissioner of Customs’ rejection of the release request?

A2: The Principal Commissioner of Customs cited that the seized gold was allegedly procured from importers who diverted imported gold to the local market, making it ‘prohibited goods’ under the Customs Act 1962.

Q3: What conditions were imposed for the provisional release of the seized goods?

A3: The Tribunal ordered the release of the seized goods, subject to conditions including the furnishing of a bond for the full value of the seized goods and a Bank Guarantee containing an auto-renewal clause for an amount of 30% of the value of the seized goods.