M AMBALAL Vs. UNION OF INDIA

JUDGEMENT

(1.) Petitioner imported diamonds of foreign origin without a valid licence. Goods were confiscated. They were ordered to be released on payment of redemption fine. An appeal was filed. When appeal was pending KVS came into existence. In the meantime petitioner had filed a writ petition. In view of KVS the writ petition came to be withdrawn. Petitioner has paid 50% of the fine under KVS. Petitioner seeks release of diamonds. Petitioner is asked to pay duty. Therefore Writ Petition.

(2.) We do not find any merit in the Writ Petition. Under Section 125 of the Customs Act duty amount is payable in addition to fine.

(3.) The dispute pending the High Court was on the question as to whether goods were of foreign origin and if not whether Department was entitled to confiscate. Petitioner opted for KVS. But there was no dispute in respect of duty amount. The dispute was only for redemption fine. Hence we cannot order release of goods without payment of duty. This is also clear from the definition of Tax Arrears under KVS. Hence rejected. This order will not prevent the petitioner from raising legal contentions before the A.O.