Imported Gold Detained under Customs Act as Mis Declared Country in Origin Certificate: Madras HC directs to Release Goods after Paying 100% Duty [Read Order]

The Madras High Court directed the customs authority to release the detained gold after paying 100 % customs duty. The imported gold was detained under the Customs Act, of 1962 due to the misdeclaration of country in origin certificate. M/s.Precious Metals Refiners Private Limited, the petitioner is a Private Limited Company and registered under the Companies Act, of 1956.

The object of the Petitioner Company is to carry on the business of refining the Gold out of Gold Dore after importing Gold from Gold producing GEA Countries as per the terms of the License issued by the Directorate General of Foreign Trade (DGFT), Ministry of Commerce and Industry. The petitioner has imported gold weighing 74,618.48 of Gold Dore Bars at USD 4,519,248.95 which were supplied by M/s.JSK Jewellery LLC, Dubai and filed a Bill of Entry. Further claimed the clearance of the goods for Home Consumption.

The petitioner had also filed an Airway Bill and declared the above goods as classifiable under 71081200 and the origin of the said goods as Guinea. The Ministry of Commerce viz., DGFT after perusing all the documents and after proper inspection and perusing the documents viz., NABL Certificate, NOC from Pollution Control Board, has issued an Import Export License for the import of Gold Dore Bars up to 95% purity for a quantity of 10.0 MTS., and from all GEA Countries.    As per the above license issued by the Ministry of Commerce, DGFT, New Delhi, the petitioner had imported the above goods viz., Gold Dore Bars and subsequently, by letter dated 04.10.2023, the petitioner had requested the respondents herein to release the goods provisionally under Section 110 A of the Customs Act.

Mr. A.K. Jayaraj, the learned counsel for the petitioner, Mrs. R. Hemalatha, learned Senior Standing Counsel for respondents 1-3 and Mr. V. Sundareshwaran, learned Senior Standing Counsel for respondent No.4 argued at length and during arguments. Since the petitioner is suffering towards heavy airport warehouse charges and a drastic fall in the market price of gold, the petitioner is ready to furnish a bank guarantee or in the alternative agree to pay 100% duty under protest, provided the respondents, pending adjudication proceedings may order for the release of the detained goods forthwith.

The counsel for the petitioner also insisted upon this Court to issue a direction to complete the adjudication proceedings in a time-bound manner.  On the other hand, the respondents submitted that since the petitioner imported the goods (viz., Gold)  from some other Country and not from Guinea, the respondents have rightly detained the goods and hence, the petitioner is not entitled to seek exemption. Since the petitioner has come forward to pay 100% duty under protest, the single bench of Justice Krishnan Ramasamy directed to consider the petitioner’s request and release the goods subject to payment of 100% duty by the petitioner within a week from the date of payment of 100% duty made by the petitioner by law.

Further held that “The petitioner, after making the payment of 100% duty, is at liberty to make an appropriate application seeking the release of the goods, which shall be considered by the Authority concerned.  The respondents are also directed to adjudicate the matter relating to the issue of exemption of duty for import of gold by the petitioner by law after affording ample opportunities to the petitioner, as expeditiously as possible, preferably, within three months.”

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