By TIOL News Service

MUMBAI, JAN 09, 2018: THE Commissioner of Customs (Import) is in appeal against the order dated 31st October 2017 - 2017-TIOL-4000-CESTAT-MUM passed by the CESTAT.

By the impugned order, the Tribunal held thus –

Cus – Public order should be passed by public authority publicly to serve public interest – It should not be a decision conveyed by his subordinate without being passed publicly and behind the back of the appellant - Litigant should not made remediless – Commissioner directed to pass a public order hearing the appellant publicly without communicating his decision through a subordinate - Tribunal advises Chief Commissioner to issue guidelines to field officers – Appeal disposed of: CESTAT

The Revenue urges the following question of law -

"Whether the Tribunal has jurisdiction to entertain an Appeal against a letter allowing provisional release of Vessel “Sagar Fortune” under Section 110A of the Customs Act, 1962"?

The High Court while admitting the question of law observed –

+ It appears, that , the Revenue had not urged the issue raised herein above before the Tribunal. However, as the question raised is one of jurisdiction on undisputed/admitted facts, going to the root of the dispute, and if the appellant is correct, it would make the impugned order dated 31 October 2017 a nullity (Kiran Singh & Ors. Vs. Chaman Paswan AIR 1954 (SC) 340) we are considering the question urged.

+ In support of considering a question of jurisdiction (on admitted facts) in an appeal before this court even when not urged before the Tribunal we place reliance upon the decision of the Supreme Court in Santosh Hazari vs. Purshottam Tiwari 251 ITR 84 .

Nonetheless, at the request of the Counsel, the appeal itself was taken up for final disposal.

After narrating the facts relevant to the appeal and the provisions of the Customs Act, in the context of the appeal, the High Court inter alia observed –

++ the nature of the power conferred under Section 110 read with Section 110A of the Act is to deprive a owner of the goods the use of his property till the final adjudication of the proposed confiscation or allowing the provisional release of the goods subject to certain conditions to safeguard the interest of the Revenue till the final decision is taken.

++ it is undisputed that the exercise of power which is conferred under Section 110A of the Act would have civil consequences. The power when exercised could lead to either the State being left without security by the time the adjudication order is passed or the conditions for provisional release could be so onerous that it would be impossible for the importer to comply with them and use the goods till adjudication is over. The person vested with the power to allow provisional release of the seized goods is the adjudicating authority under the Act. The Act itself deals with import of goods into the country. All of the above, would suggest that the order/decision given for provisional release would be in the nature of quasi judicial decision/order.

++ a right of an appeal has to be bestowed by a statute and no person can claim it as of a right, de hors the statute. However, having found that there is a right of appeal conferred from the orders of the Commissioner of Customs in terms of Section 129A (1) (a) of the Act, it must be construed liberally (CIT vs. Ashoka Engineering 194 ITR 645) . This is particularly so as sub clause (a) unlike other sub clauses to sub-section 1 of Section 129A of the Act does not restrict the right of appeal to the sections of the Act under which the order is passed and/or decision taken.

++ moreover an appeal from a decision of provisional release under Section 110 A of the Act, would cause no prejudice to the Revenue. The goods which have been seized continue to be seized until the importer satisfies the conditions of provisional release and the adjudication proceeding are not in any manner halted / adjourned, merely because the importer is not satisfied with the terms of provisional release. Therefore we hold that the order/direction given under Section 110 A of the Act is an appealable order under Section 129A(1) (a) of the Act .

Expressing its agreement with the analysis done by the larger bench of the Tribunal in Gaurav Pharma - 2015-TIOL-2541-CESTAT-DEL-LB, the Bombay High Court concluded that the letter dated 25.09.2017 (communicating the decision of the Commissioner of Customs (Import-I) allowing provisional release u/s 110A, of the imported vessel) is a decision taken by the adjudicating authority and is appealable to the Tribunal under Section 129A (1)(a) of the Act.

The substantial question of law was answered in the affirmative, that is in favour of the Respondent – Assessee and against the Revenue.

The Revenue Appeal was dismissed.

(See 2018-TIOL-53-HC-MUM-CUS)