IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE V.GIRI TUESDAY, THE 16TH DECEMBER 2008 / 25TH AGRAHAYANA 1930 WP(C).No. 31005 of 2008(N) ------------------------------------ PETITIONER : ---------------- PARAYIL ABDU RAHIMAN, PARAYIL HOUSE, PULLUR, THEKKANKUTTUR P.O., MALAPPURAM DISTRICT. BY ADV. SRI.P.A.AUGUSTIAN SRI.T.R.JAGADEESH RESPONDENTS : ------------------- 1. THE COMMISSIONER OF CUSTOMS, CUSTOM HOUSE, WILLINGDON ISLAND, KOCHI 682 009. 2. THE CHAIRMAN OF PORT TRUST, PORT TRUST, WILLINGDON ISLAND, KOCHI 682 009. ADV. SRI.THOMAS MATHEW NELLIMOOTTIL,SC,CB EX FOR R1 SRI.E.K.NANDAKUMAR FOR R2 SRI.A.K.JAYASANKAR NAMBIAR FOR R2 SRI.K.JOHN MATHAI FOR R2 SRI.P.BENNY THOMAS FOR R2 SRI.ANIL D. NAIR FOR R2 SRI.V.J.ANAND FOR R2 THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 16/12/2008 ALONG WITH WPC NO. 36171 OF 2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING : WP(C).No. 31005 of 2008(N) APPENDIX PETITIONER'S EXHIBITS: EXT.P1: TRUE COPY OF THE INVOICE NO.PJ43125 DATED 21.05.2008. EXT.P2: TRUE COPY OF THE B/L NO.JEA/COK/748 DATED 22.07.2008 EXT.P3: TRUE COPY AFFIDAVIT DATED 06.08.2008 EXT.P4: TRUE COPY OF THE EXPORT CERTIFICATE AND ITS ENGLISH TRANSLATION EXT.P5: TRUE COPY OF THE EXAMINATION REPORT DATED 13.08.2008 EXT.P6: TRUE COPY OF THE ARGUMENT NOTE SUBMITTED BEFORE THE ADJUDICATION AUTHORITY EXT.P7: TRUE COPY OF THE RELEVATN PROVISIONS OF PRESENT IMPORT POLICY REGARDING IMPORT OF CAR EXT.P8: TRUE COPY OF THE RELEVANT PROVISION OF SCALE OF RATES FOLLOWED BY RESPONDENT NO.2 TILL 2007 EXT.P9: TRUE COPY OF THE RELEVANT PROVISION OF SCALE OF RATES ISSUED BY THE SECOND RESPONDENT EXT.P10: TRUE COPY OF THE LETTER DATED 17.11.2008 EXT.P11: TRUE COPY OF THE LETTER DATED 19.11.2008 EXT.P12 SERIES: TRUE COPY OF THE LETTER DATED 10.09.2007 ALONG WITH TR6 CHALAN, B/E. COPY OF THE ORDER OF HON'BLE SUPREME COURT IN CIVIL APPEAL NO.5207 OF 2006 DATED 09.07.2007 EXT.P13: TRUE COPY OF THE ORDER-IN-ORIGINAL DATED 21.11.2008 -TRUE COPY- P.A. TO JUDGE V.GIRI, J. ------------------------------------------------------ W.P.(C) Nos.31005 & 36171 OF 2008 ------------------------------------------------------ Dated this the 16th day of December, 2008 JUDGMENT Since common contentions are raised in these writ petitions, they have been heard together and are being disposed of by this common judgment. 2. The petitioner in W.P.(C) No.31005 of 2008 imported a Hummer H2 car of 2003 model. The car was inspected and it seems that the customs authorities were not satisfied regarding the model of the vehicle. Adjudication proceedings were taken up and Ext.P13 order was passed, rejecting the invoice value of the vehicle and assessing the same on the basis of the judgment of the adjudicating authority. Petitioner was called open to remit a fine of Rs.6 Lakhs and penalty of Rs.2 Lakhs, for releasing the vehicle. 3. An appeal was preferred against Ext.P13 order and the same is pending. In the meanwhile the vehicle is lying in the open and demurrage is also being incurred unnecessarily, it is contended. Hence the petitioner prays for a direction for release of the vehicle. W.P.(C) 31005 & 36171 of 2008 2 4. Insofar as W.P.(C) No.36171 of 2008 is concerned, petitioner imported a Volkswagen Bettle of 2003 model. Value of the vehicle assessed in the invoice is Rs.3,53,242/-, but the adjudicating authority assessed the same at Rs.8,40,902/-. Differential duty has been directed to be paid apart from fine and penalty. Petitioner has filed an appeal before the 3rd respondent against the decision of the adjudicating authority. He seeks the release of the vehicle in the meanwhile. 5. In my view, since the invoice value has not been accepted by the customs authorities and the matter is to be adjudicated upon by the appellate authority under the Act, it may not be justified to keep the vehicles with the dept. itself lying in the open. To protect the interest of the revenue it would only be appropriate that the vehicles are released to the custody of the petitioners on conditions. I take note of the fact that there is no dispute regarding the identity of the importer. There is no case registered against the petitioner for contravention of any penal provision under the Customs Act. 6. In these circumstances, writ petitions are disposed of with the following directions : W.P.(C) 31005 & 36171 of 2008 3 (i) Insofar as W.P.(C) No.31005 of 2008 is concerned, the petitioner shall remit the duty payable as per the invoice value, viz; Rs.14,57,712/- along with 50% of the amount imposed as fine and penalty viz; Rs.3 Lakhs plus Rs.1 Lakh within one week from today. The petitioner shall also furnish bank guarantee for an amount of Rs.22,66,690/- (Twenty two lakhs sixty six thousand six hundred and ninety only) (ii) The petitioner shall also deposit with the Cochin Port the demurrage determined on the basis of invoice value and shall furnish bank guarantee for differential amount by way of demurrage calculated on the basis of the value assessed by the department. (iii) The bank guarantee for the amount mentioned in paragraph (i) shall be furnished in favour of the Commissioner of Customs, Kochi and shall be kept alive for a period of one year or till such time as the appeal and any proceedings W.P.(C) 31005 & 36171 of 2008 4 thereupon pursuant to Ext.P13 is finally decided. The petitioner shall take steps to extend the period of validity of the bank guarantee on a requisition made by the Customs Department from time to time. The bank guarantee shall be cancelled only after completion of the proceedings, arising from Ext.P13, before the statutory authorities and subject to the orders to be passed in that regard by the authority under the Customs Act. (iv) The bank guarantee for the amount mentioned in paragraph (ii) shall be furnished in favour of the competent authority of the Cochin Port Trust and shall be kept alive for such period as required by the Port Trust. (v) Insofar as the petitioner in W.P.(C) No.36171 of 2008 is concerned, he shall deposit an amount of Rs.5,91,083/- being the duty payable on the invoice value within one week from today and he also furnish bank guarantee for the W.P.(C) 31005 & 36171 of 2008 5 differential duty amount viz; Rs.8,35,548/- drawn in favour of the Commissioner of Customs, Kochi. (vi) Petitioner shall also remit an amount of Rs.1,87,500/- being 50% of the amount payable as fine and penalty as per Ext.P5 order, drawn in favour of the Commissioner of Customs, Kochi. (vii) Petitioner shall remit with the Cochin Port Trust demurrage determined on the basis of the invoice value and shall also furnish a bank guarantee in favour of the Cochin Port Trust for the differential amount payable as demurrage, calculated on the basis of the assessed value. On satisfaction of the conditions, as mentioned above, the vehicles shall be released to the petitioners in W.P.(C) Nos.31005 of 2008 and 36171 of 2008 without further delay. Subject to the final outcome of the proceedings before statutory authorities, it is open to the petitioners to institute appropriate proceedings against the Customs Department for W.P.(C) 31005 & 36171 of 2008 6 recovery of the amounts, collected from them by way of demurrage, by the Port Trust, provided they are successful in the proceeding, under the Customs Authorities. V.GIRI, JUDGE pac