M/S Nayasa Exports Pvt. Ltd. Vs. Commissioner of Customs (Exports), Nhava Sheva - Court Judgment

Excerpt:
per: shri ashok jindal, member (judicial) the appellants (exporter) have filed this appeal against the order of the commissioner of customs (exports) extending the time limit for issuing the show-cause notice for another period of six months in terms of the proviso of section 110(2) of the customs act, 1962. 2. the facts of the case are that during the course of investigation into large scale misuse of export incentive scheme like duty drawback and depb in the export of ready-made garments and fabrics by a number of export firms, the directorate of revenue intelligence (dri), mumbai came across that the appellants are having the iec number and the activities of the appellants are managed by its director shri yunus h mithwani. on examination of the customs-edi data, it was observed that.....

Judgment:

Per: Shri Ashok Jindal, Member (Judicial)

The appellants (exporter) have filed this appeal against the order of the Commissioner of Customs (Exports) extending the time limit for issuing the show-cause notice for another period of six months in terms of the proviso of Section 110(2) of the Customs Act, 1962.

2. The facts of the case are that during the course of investigation into large scale misuse of export incentive scheme like duty drawback and DEPB in the export of ready-made garments and fabrics by a number of export firms, the Directorate of Revenue Intelligence (DRI), Mumbai came across that the appellants are having the IEC number and the activities of the appellants are managed by its Director Shri Yunus H Mithwani. On examination of the Customs-Edi data, it was observed that the appellants had availed export benefits as below: -

Year

Numbers of shipping bills filed

FOB value of exported goods

(Rs. in crores)

DEPB benefit claimed/availed (Rs. in crores)

Drawback benefit claimed/availed

(Rs. in crores)

2007

1076

55.42

0.02

6.08

2008

1555

101.02

0.13

7.86

2009

976

91.00

1.13

7.86

Total

3607

247.44

1.28

21.86

The declared business premises of the appellants were located at Amina House, 130-136, J.B. Shah Marg, Gr. Floor, 1st Chinch Bunder Road, Mumbai -9 comprising of 300 Sq. ft. office and one staff and two unskilled labourers were working there. The department to protect its own property and or money which were discovered to have been handed over to and collected by the exporter wrongly and the same was required to be recovered in accordance with law and with the reasonable belief that the said exporter had fraudulently availed huge amount of export benefits from the Government by inflating the value of goods exported by them. The foreign remittance received into the account of the said firm against such exports and the exports incentives received by the exporter by sale of such illegal DEPB/ineligible drawback can be construed as proceeds from the sale of smuggled goods under Section 110 of the Customs Act, 1962. Accordingly, during the period of investigation and to safeguard the interests of the Revenue, the banker of the exporter was instructed not to allow any withdrawals from the bank account of the said exporter. M/s Union Bank of India, Mohd. Ali Road Branch, Mumbai frozen the account of the exporter on the instruction of the DRI w.e.f.15.12.2009. The DRI also requested the O/o the DGFT to keep on hold the issuance of any further DEPB scripts to the said exporter and the Drawback section of JNCH, Nhava Sheva was also asked not to sanction any further duty drawback to the said exporter during pendency of the investigation.

3. During the course of investigation, it was revealed that the appellants were exporting ready-made garments and fabrics to the parties located in different countries like Dubai, Saudi Arabia, Tanzania, Sri Lanka etc. In almost all the cases, in the export invoices and bills of lading the shipper was declared as one M/s NSK General Trading LLC Dubai. Some exports were also effected to Tanzania. On verification with M/s COTECNA Inspection Pvt. Ltd. (an agency appointed by the Tanzanian Government to assist the Tanzanian Customs authorities to verify the value and product classification of goods imported into Tanzania), it was revealed that in respect of the consignment exported by the said exporter under bill of lading No. NSA/DAR/FCL/20090170 dated 2.2.2009, the FOB value declared to the Indian Customs was $ 2,61,835.50 while the corresponding value declared to the Tanzanian Customs was only $ 5223. This evidence showed that there was gross over-valuation at the time of export from India to claim inadmissible export incentives from the Indian Govt. The said consignment was seized by the Tanzanian Customs. However, the exporter has managed to bring foreign exchange remittance in full in this export also. But they failed to explain how they had managed remittance of the entire amount as declared to the Indian Customs when the actual transaction value was fraction of the value declared to Indian Customs. The exporter was also asked to produce all the local purchase documents and details of financial transaction like payment to the seller and to disclose the sources from where they had procured the goods exported by them so that the genuineness of the export benefit claimed by the could be verified. But the exporter has failed to produce such documents and the exporter is under obligation to co-operate with the investigation as per the direction of the Hon ble Delhi High Court by its order dated 3.6.2010. The investigation could not be completed within six months from the seizure of the goods i.e. Bank account of the exporter in this case. The Commissioner (Exports) extended the time limit for issuance of the show-cause notice under the proviso of 110(2) of the Customs Act, 1962. Aggrieved from the said order of extending time to seize the Bank account by six months to issue the show-cause notice, the appellants are before me.

4. Shri Sanjay Agarwal, learned Advocate appearing on behalf of the appellants submitted that the show-cause notice dated 9.6.2010 was issued to the appellants purportedly under Section 110(2) read with Section 124 of the Act proposing such extension alleging the freezed Bank account as seized goods .

4.1 He also submitted that as per para 1.4 of the impugned order, the amount lying in the Bank account is foreign remittances against the exports and has been deposited alleged ineligible export incentives received under Drawback, or sale proceeds of alleged illegal DEPB scripts issued to the appellants. Accordingly, all these are sought to be construed as proceeds of sale of smuggled goods under Section 110 of the Act, and are liable for confiscation under Section 113 of the Customs Act, 1962. He further submitted that the Commissioner has failed to give judicious consideration to the submissions of the appellants given vide reply dated 11.6.2010 denying all allegations leveled in the show-cause notice.

4.2 He also submitted that there was no sufficient cause for extension under Section 110(2) for a period of six months, by continuing to freeze the Bank Account, for want of those purchase documents and payment details from the appellants, which admittedly pertain to purchases and payments there against by Shri Ali Farooq, a UAE national from M/s NSK General TDG LLC, and not by the appellants. He also submitted that they have complied with the order of the Hon ble Delhi High Court and submitted entire relevant records available with them being their own documents such as audited balance sheets, ledger accounts of sale and purchase, purchase vouchers, bank statements, banker s realization certificates, copies of Bills of Lading, contract / Memorandum of Understanding, etc, and one affidavit of Shri Ali Farooq. On all the occasions when the appellants were called, they have appeared before the officers for statements and investigation. The appellants had co-operated with the department in investigation and they have made a request to Shri Ali Farooq also to supply the purchase vouchers but Shri Ali Farooq denied for supplying the same. In spite of co-operation made by the appellants, the conclusion of the Commissioner was not just and proper and he has lacked with sufficient cause for passing the impugned order. The department is asking those documents, which are not under the control of the possession of the appellant, adverse inference cannot be taken and the same cannot be the ground for extension of time for investigation by continuing the seizure of any goods . The Commissioner has also erred in interpreting the order that the Hon ble High Court of Delhi upheld the applicability of Section 110 in the matter. The Commissioner ignored and not dealt with the judgment cited by the appellants on the ground that the officers of the DRI do not have power to freeze bank account in the following cases: -

a. Vikas Gumbar Vs. UOI : 2009 (234) ELT 439 DEL;

b. Raghuram Grah Pvt. Ltd. Vs. CCE: 2005 (186) ELT 50 Allahabad;

c. Anil Kumar Mehensaria Vs. C.C. Port : 2003 (115) ELT 18 Calcutta

4.3 The Ld. Commissioner also failed to consider that if the amount lying in the bank is sale proceeds of the goods exported, thus there is no charge of over-valuation be confirmed as the appellants have not received any extra amount apart from lying in the Bank. He also submitted that if the goods are over-valued then the amounts lying in the Bank, which has been seized by the DRI are not the sale proceeds of the goods, the DRI has no power to freeze the same. He also relied on the ratio laid down by this Tribunal in the case of Sharp Menthol India Ltd Vs CCE, Delhi-1, 2007(214)ELT59(Tri-Del), wherein it was held that no seizure shall be made so as to disrupt the delivery schedule of export goods. In exceptional cases where seizure is made, the same should be lifted within 7 days and undertaking can be asked from the exporter. It was also held that extension of time limit under section 110(2) affects the right of the citizen and therefore Revenue is liable to show sufficient cause with a definite and cogent reason. It was also clarified that the show cause notice may be issued even after release of the seized goods in accordance with law. Thus, it was prayed that continuation of freezing the bank accounts is not at all warranted, and even after release thereof the investigations can proceed and show-cause notice can be issued thereafter.

4.4 He also submitted that information of the suppliers of the export goods was not at all relevant to determine the value as per the Customs Valuation (Determination of Value of Export Goods) Rules, 2007. He further submitted that if the drawback is granted in excess or erroneously, can be recovered under Rule 16 of the Customs and C. Excise Duties and S.T. Drawback Rules, 1995 read with Section 142(1) of Customs Act, 1962, but cannot be freezed under Section 110 of the Act. He also submitted that at the time of export, the export declarations, examination reports, officers comments are available in the EDI system, while issuing the Let Export Order by the Proper Officer. The DRI can investigate the same from EDI system also. He further submitted that the appellants have made request to the DRI to depute the officers to visit Tanzania and to bring samples of the goods seized at Tanzania port wherein it is alleged that the goods are under valued at Tanzania by the consignee to save duty applicable to Tanzania thereon. He further submitted that full remittances were received through banking channels and the export value was already verified before permitting exports, the bank account has been seized merely on suspicion as admitted by ADG, DRI in his communication dated 11.2.2010.

4.5 In the absence of any existence of reasonable belief on the date of seizure (on or about 25.9.2009 in relation to the Drawback account and export incentives under Drawback and DEPB schemes, and 11.12.2009 in relation to the Bank Account), the seizure itself was without jurisdiction and therefore there was no question of granting extension for continuance of the illegal seizure .

4.6 With regard to the Drawback account with SBI and the export incentives under the Drawback scheme are concerned, the time limit of six months was already expired and the Ld. Commissioner has failed to release even the freezed Drawback account and the export incentives, ignoring the statements made by the Counsel for the Revenue before the Hon ble Delhi High Court vide Order dated 3.6.2010 that - the time limits as set out in Section 110 of the Customs Act will be adhered to. He also relied on the following decisions: -

(i) Asstt. Collector Vs Charan Das Malhotra- 1983 (13) ELT 1477

(ii) Gurmukh Singh s case - 1984 (18) ELT 274 (PandH)

(iii) Bhavesh Exports Pvt Ltd - 2002 (144) ELT 50 (Bom)

At last he prayed that the impugned order be set aside with consequential relief.

5. On the other hand, learned SDR submitted that there are several evidences against the appellants namely: -

(a) The appellants are having their office premises in a 300 Sq. ft. area with only one office staff and two unskilled labourers, it is doubtful that the person having such type of infrastructure can export the goods worth more than Rs.200 crores in past three years.

(b) The appellants are exporting their goods to various countries like Dubai, Saudi Arabia, Tanzania, Sri Lanka etc. but the exports proceeds are coming back only from Dubai.

(c) In the case of export to Tanzania, it is pointed out by M/s COTECNA Inspection Pvt. Ltd. that the FOB value of Indian Customs was $ 2,61,835.50 in Bill of Lading No. NSA/DAR/FCL/ 20090170 dated 2.2.2009 while the corresponding value declared at Tanzania Customs was only $ 5223 which shows that there was a gross over-valuation at the time of export from India.

All these over-valuation have been done to avail undue DEPB benefits and drawback from the Govt. The Hon ble High Court of Delhi has categorically said that if the party co-operates with the investigation, the department will comply with the actions under Section 110 of the Customs Act, 1962. The appellants have failed to submit local purchases documents, details of financial transaction like payment to the seller, disclose the sources from where they had procured the goods exported by them. For arriving at correct DEPB and drawback benefits these are crucial documents to ascertain the purchase price of the goods exported, so that the genuineness of the export benefit claimed by them is to be verified. On verification with the issuing bank it was observed that none of cheques were deposited in the Bank account of the persons/firms in whose favour these cheques were issued by the appellants against their procurement of goods. He further submitted that proviso to Section 110(2) of the Customs Act, 1962 deals exactly with such a situation where the department needs another 6 more months and the Commissioner has shown the sufficient grounds to extend the period of 6 months after giving the show-cause notice which was very well within his jurisdiction. The Commissioner has passed a reasonable order after going through the evidences before him and when the appellants are not co-operating in the investigation. On the other hand, the appellants are not co-operating in the investigation. Hence, the Commissioner has reasonable belief in extending the time to issue the show-cause notice by another 6 months. Lastly he relied on the case law in the case of Engee Industrial Services (Pvt. Ltd. Vs. Commissioner of Customs, Bombay reported in 1996 (81) ELT 100 (Tri), which deals with the issue and the issue is covered by the said decision. Finally he prayed that the appeal be dismissed, which is without any merits.

6. Heard both sides. I have carefully gone through all the submissions made by both the sides.

7. In this case, the issue is that whether order of extending the time limit for issue of show-cause notice for another period of 6 months i.e. upto 14.12.2010 in terms of proviso of Section 110(2) of the Customs Act, 1962 is legal and correct or not.

8. Before going into the issue, the relevant provisions of law are reproduced herein under for better appreciation: -

The Customs Act, 1962:

SECTION 110.?Seizure of goods, documents and things. (1) If the proper officer has reason to believe that any goods are liable to confiscation under this Act, he may seize such goods :

Provided that where it is not practicable to seize any such goods, the proper officer may serve on the owner of the goods an order that he shall not remove, part with, or otherwise deal with the goods except with the previous permission of such officer.

(2)?Where any goods are seized under sub-section (1) and no notice in respect thereof is given under clause (a) of section 124 within six months of the seizure of the goods, the goods shall be returned to the person from whose possession they were seized :

Provided that the aforesaid period of six months may, on sufficient cause being shown, be extended by the [Commissioner of Customs] for a period not exceeding six months.

SECTION 113. Confiscation of goods attempted to be improperly exported, etc. The following export goods shall be liable to confiscation:-

(a)?any goods attempted to be exported by sea or air from any place other than a customs port or a customs airport appointed for the loading of such goods;

SECTION 121.?Confiscation of sale-proceeds of smuggled goods. Where any smuggled goods are sold by a person having knowledge or reason to believe that the goods are smuggled goods, the sale-proceeds thereof shall be liable to confiscation.

SECTION 124.?Issue of show cause notice before confiscation of goods, etc. No order confiscating any goods or imposing any penalty on any person shall be made under this Chapter unless the owner of the goods or such person -

(a) is given a notice in [writing with the prior approval of the officer of Customs not below the rank of a Deputy Commissioner of Customs, informing] him of the grounds on which it is proposed to confiscate the goods or to impose a penalty;

(b) is given an opportunity of making a representation in writing within such reasonable time as may be specified in the notice against the grounds of confiscation or imposition of penalty mentioned therein; and

(c) is given a reasonable opportunity of being heard in the matter :

Provided that the notice referred to in clause (a) and the representation referred to in clause (b) may, at the request of the person concerned be oral.

Definitions

Section 2

(22) goods includes

(a) vessels, aircrafts and vehicles;

(b) stores;

(c) baggage;

(d) currency and negotiable instruments and

(e) any other kind of movable property.

(39) smuggling , in relation to any goods, means any act or omission which will render such goods liable to confiscation under Section 111 or Section 113.

Customs, Central Excise Duties and Service Tax Drawback Rules, 1995:

Rule 16. Repayment of erroneous or excess payment of drawback and interest. - Where an amount of drawback and interest, if any, has been paid erroneously or the amount so paid is in excess of what the claimant is entitled to, the claimant shall, on demand by a proper officer of Customs repay the amount so paid erroneously or in excess, as the case may be, and where the claimant fails to repay the amount it shall be recovered in the manner laid down in sub-section (1) of section 142 of the Customs Act, 1962 (52 of 1962).

9. In the instant case, during the course of investigation it was observed that the appellants are engaged in the business of export of ready-made garments. During last three years the exporter has exported the goods worth more than Rs.247.44 crores. To export the said goods the appellants had filed 3607 shipping bills under DEPB benefit scheme to different countries like Dubai, Saudi Arabia, Tanzania, Sri Lanka etc. Only in one consignment at Tanzania, on verification it was revealed that in the consignment exported by the appellants under Bill of Lading No. NSA/DAR/FCL/ 20090170 dated 2.2.2009, the FOB value declared to Indian Customs was $ 2,61,835.50 while corresponding value declared to Tanzanian Customs was only $ 5223. It was alleged against the appellants that they have over-valued the goods at the time of export from India to claim higher export incentives against those exports. The department, on the suspicion of the charges that the appellants had over-valued the goods, to safeguard the revenue, directed the Bankers of the appellants (M/s Union Bank of India, Mohd. Ali Road Branch, Mumbai) not to allow any withdrawal from the Bank account by the appellants and the same was freezed by the Banker on the instructions of the DRI w.e.f. 15.12.2009. The DRI also requested to O/o the DGFT to keep on hold issue of further DEPB Script and Drawback section of JNCH also instructed not to sanction any duty drawback during pendency of the investigation. These powers were exercised by the department under the proviso of Section 110(1) of the Customs Act, 1962 on the ground that they have reason to belief that the goods are liable to confiscation in this act.

9. As per the provisions of Section 110(1), the proper officer is having the power to seize the goods. Section 121 of the Customs Act, 1962 clarify that the sale-proceeds of the smuggled goods are also liable to be confiscated. In this case, as the goods have already been exported, the sale-proceeds received against these goods of exported illegally (smuggled goods), are liable for confiscation. In that situation the Bank account of the appellants was seized w.e.f. 15.12.2009 by the proper officer with a direction to the Banker of the appellants. As the show-cause notice was not issued for confiscation of the goods as per the provisions of Section 124, the show-cause notice dated 9.6.2010 was issued to the appellants for extension of time limit to freeze the current bank account by extending a period of 6 months to issue the show-cause notice. The show-cause notice dated 9.6.2010 was finally adjudicated by holding that the Commissioner is having sufficient reason to believe and the time limit has been extended. As per proviso of Section 110(2) of the Act, the Commissioner can extend the period for another six months to issue the show-cause notice for seizure of goods on sufficient cause being shown. In this case, the main allegation against the appellants is that they have over-valued the exported goods, which are not available, only the sale-proceeds received through the Bank account and the same are lying in the Union Bank of India, Md. Ali Road Branch in current account of the appellants. In the impugned order, the Commissioner has not given any finding that, whether the amount lying in the Bank are sale-proceeds of the goods exported. If it is taken that the amount lying in the Bank is sale-proceeds of the goods, which are over-valued, the contention of the Revenue that these are sale-proceeds of the smuggled goods is not correct. If these are not the whole sale-proceeds of the smuggled goods, the Commissioner has to show the sufficient reason to belief to seize the Bank account. As per the version of the Revenue that the goods have been over-valued by 50 times of the actual value of the goods than in this case, the amount lying in the Bank account cannot be the sale-proceeds of the exported goods. There is no allegation against the appellants that they have received the money against the exported goods by other channels also. The amount which is lying in the bank account is against the goods exported through shipping bills filed before the Customs. With regard to excess duty drawback, the Bank account cannot be seized because there is a separate provision in the Customs, Central Excise Duties and Service Tax Drawback Rules, 1995. Rule 16 deals with the situation where an amount of drawback and interest has been paid erroneously or the amount so paid is in excess of what the claimant is entitled to, the claimant shall, on demand by a proper officer of Customs repay the amount so paid erroneously or in excess, as the case may be, and if the claimant fails to repay the said amount, there is a recovery procedure laid down in sub-section (1) of Section 142 of the Customs Act, 1962.

10. In the first instance, the seizure of bank account and the DEPB claim was on the suspicion but while extending the period of seizure for another six months, the Commissioner has to arrive at the decision, whether the amount lying in the Bank account (which they have seized) are the actual sale-proceeds of the goods exported. If they are the actual sale-proceeds then the Revenue has no case of overvaluation. If they are not the actual sale-proceeds, the seizures are not legal and proper and no seizure can be done. There is no provision in the Act to confiscate the Drawback incentives and sale-proceeds of DEPB.

11. In the case of Charan Das Malhotra reported in 1983 (13) ELT 1477 (SC), the Hon ble Apex Court has made the distinction between Section 110(1) and Section 110(2) of the Customs Act, 1962, which is reproduced herein as under: -

It will be noticed that whereas sub-section (1) of Section 110 uses the expression reason to believe for enabling a Customs officer to seize goods, the proviso to sub-section(2) uses the expression sufficient cause being shown . Thus, sub-section (1) does not contemplate an enquiry at the stage of seizure, the only requirement being the satisfaction of the concerned officer that there are reasons to believe that the goods are liable to confiscation by reason of the illegal importation. It is, therefore, clear that in view of words sufficient cause being shown in Section 110 (2), the legislature did not intend to give the Collector the same power for extension of time.

In the case of Anil Kumar Mahensaria Vs. Commissioner of Customs (Port) 2003 (155) ELT 18 (Cal), the Hon ble High Court has observed as under:-

Once the drawback amount is issued and the same has been placed in the account of the petitioner, such money becomes the property of the petitioner. The moment it becomes the property of the petitioner, the customs authority can attach such property only in accordance with law either by taking aid of necessary order through competent court or by exercise of power, if conferred upon it, by statue. There is no provision of any statute which enables Deputy Commissioner to seize any personal property of the petitioner including money lying in a bank account merely because an investigation is going on in respect of an export transaction for which drawback has been released in favour of the petitioner. Even if the Customs Authority approaches the Court for an order in the nature of attachment before judgment, in such a case, such attachment can be limited to the extent of money fraudulently obtained but not in excess of that amount. In this case, till date no final order has been passed holding that any amount received by the petitioner by way of drawback was outcome of fraudulent export. Both the Deputy Commissioner and the Bank acted illegally and without jurisdiction resulting in withholding of the amount available in the account of the petitioner and such interference on their part was unauthorized.

In the case of Raghuram Grah Pvt. Ltd. Vs. Commissioner of Central Excise and Service Tax reported in 2005 (186) ELT 50 (All.), the Hon ble High Court of Allahabad has held that we find no provision nor any authority under which the bank account can be freezed pending investigation. In the case of Bhavesh Exports Pvt. Ltd. Vs. Assistant Collector of Customs reported in 2002 (144) ELT 50 (Bom), the Hon ble High Court of Bombay has held that we cannot resist ourselves from observing that the action initiated by respondent No. 1 was not only arbitrary but also high handed. It cannot be justified on any count whatsoever. The said respondents, firstly, had no material in their possession to prima facie reach to the conclusion that the credit balance lying in the band account of the petitioners belonged to M/S. Bharat Export Corporation. Secondly, no such power exist in respondent No. 1 to direct the bank to freeze the account of any citizen in the manner in which it was done, that too, without initiating any action under any of the provisions of the Customs Act. No material was in existence to believe that the credit balance lying in the bank account of the petitioners was sale proceeds of the goods alleged to have been imported and disposed of by M/S Bharat Export Corporation, Mumbai. The petitioners were deprived of their right to use their property.

In the case of Economic Traders (Guj.) Ltd. Vs. Union of India reported in 2005 (12) LCX 0181, the Hon ble High Court of Gujarat has held that the role of the Customs authorities is limited to verification of the details on the DEPB, to ascertain as to whether they tally with their records or not, and nothing more. Hence, the same is out of their jurisdiction. The actions of the customs authorities in withholding the DEPB licence on the ground that their export is not covered under the DEPB is not within the jurisdiction or accordance with law. In the case of Sharp Menthol Ltd. Vs. CCE, Delhi 2007 (214) ELT 59 (Tri-Delhi), this Tribunal has also held that the show-cause notice may be issued even after the release of the seized goods in accordance with law. I make it clear that this order is passed without going into the merits of the case as the matter is pending before the investigating agency. In the case of Engee Industrial Services Pvt. Ltd. Vs. Commissioner of Customs, Bombay reported in 1996 (81) ELT 100 (Tri), the facts of the case were that the key person Shri Vinod Goyel was absconding and the goods were imported illegally were available. Accordingly, the facts of the said case are not relevant to this case.

12. The contention of the learned DR is absolutely correct that the Revenue has every right to safeguard their revenue. But it is pertinent to mention here that they have right to safeguard the revenue in a legal way. The action of the ld. Commissioner to extend the period to issue show-cause notice by another six months by seizing the Bank account is not correct without ascertaining the facts that whether the money lying in the Bank account is the sale-proceeds of the actual value of the goods or not. The High Court of Bombay held the same observation in the case of M/s Bhavesh Exports Ltd. (supra). Nowhere in the impugned order the Commissioner has been able to take decision about the sale-proceeds, although the appellants have contended in their reply of the show-cause notice. The Commissioner has also failed to show that the seizure of Bank account is required for investigation. Accordingly, the Commissioner has failed to show the sufficient cause for seizure of the Bank account by extending another period of six months for issuance of the show-cause notice and the same is not justified.

13. Nobody can prevent the department to investigate the case and in investigation, if anything is found against the appellants, the department is at liberty to take action in accordance with the law.

14. From the above discussion, the impugned order is not in accordance with law by extending seizure of Bank account by the period of six months to issue show-cause notice without holding that the money lying in the Bank account are sale-proceeds or not. In this case also as held by this Tribunal in the case of M/s Sharp Menthol (p) Ltd. (supra), the show-cause notice may be issued (even after the release of the Bank account) in accordance with law. The prayer of the learned Advocate to de-freeze the withholding DEPB scripts and incentives received under Drawback is not acceptable, as it is beyond the scope of show-cause notice dated 9.6.2010.

15. This order will not in any ways restrict the investigating authority to investigate the case and to take action as per law.

16. With these observations, the impugned order extending seizure of Bank account by a period of six months to issue show-cause notice is set aside and the appeal is allowed in the above terms.