VINOD KUMAR GUPTA, J. ( 1 ) WITH the agreement of the parties, the writ application is taken up for final disposal. ( 2 ) THE case of the petitioner is that the petitioner had purchased gold from M/s. Standard Chartered Bank and that it had been sent from Delhi to Calcutta, but in Calcutta it was illegally seized by the respondents. ( 3 ) THE respondents' case is that the gold was seized by them since they suspected that it was imported into India unauthorisedly and that the petitioner had not paid the Customs duty on the gold. The respondents' further case is that the petitioner's contention that the gold which was seized was the same as was bought by them from Standard Chartered Bank is not correct, based on the identification of the gold as seized, when compared with the identification of the gold as sold by the Standard Chartered Bank. ( 4 ) DURING the course of arguments reliance was placed by the parties on Sections 110, 111 and 112 of the Customs Act. One thing, however which clearly emerged was that the importation of gold into India is not prohibited. The dispute, either leading to the confiscation of the gold or otherwise, is mainly with regard to the liability of the petitioner to pay the Customs duty, as also any possible liability to pay the penalty if any, as prescribed under Section 112 of the Customs Act. I do not wish to make any comments with regard to the merits of all such contentions since the adjudication proceedings are contemplated and a final order is required to be passed by the respondents in accordance with the provisions of the Customs Act. ( 5 ) MR. Roy, learned Senior Advocate appearing for the respondents has stated before me that the respondents shall take a maximum of three months from today in completing the adjudication proceedings in all respects, beginning with the issuance of the show cause notice and culminating in the passing of the appropriate consequential order. ( 6 ) MR. Roy further submitted that the gold as seized would attract the levy of Customs duty to the tune of Rs. 3,26,560/ -. ( 6 ) MR. Roy further submitted that the gold as seized would attract the levy of Customs duty to the tune of Rs. 3,26,560/ -. He also submitted that if adjudication proceedings ultimately went against the petitioner, he can be found liable to pay penalty to the extent of 5 times the duty as payable, in terms of Section 125 of the Customs Act. ( 7 ) AFTER hearing the learned Advocates for the parties and considering all relevant aspects of the case I am of the opinion that Section 125 of the Customs Act does contemplate release of the gold in lieu of confiscation on payment of the amount of duty as assessable and the penalty as may ultimately be found leviable. Whether ultimately the respondents decide to levy the duty or impose penalty upon the petitioner is a matter which, however, can only be decided finally on the completion of adjudication proceedings. It is not for me to hazard any comments about this aspect of the matter at this stage. I, however, feel that the release of the gold in favour of the petitioner shall be in conformity with the spirit of Section 125 of the Customs Act which does permit such a release in lieu of contemplated confiscation provided an order is passed ensuring that the duty of customs is paid and the interest of the respondents are properly safeguarded if ultimately the respondents do consider levying penalty. The proper safeguarding of the respondents' interests in a case like the present one can effectively be achieved by prescribing such measures which may ensure that the petitioner does not escape or evade the ultimate liability, if found so, in accordance with law and on observance of all statutory protections to the petitioner. On an overall consideration, therefore, I allow the writ application and pass the following directions :1. On the petitioner paying an amount of Rs. 3,26,560/- to the respondents (this amount being in lieu of the duty payable on the gold seized) and on his furnishing a Bank Guarantee to the extent of Rs. 5,00,000/- and a bond for Rs. 10,00,000/- (these two amounts being in lieu of any possible imposition of penalty) in favour of the respondents, as prescribed under the Customs Act or the Rules framed thereunder, the respondents shall release the seized gold in favour of the petitioner. 5,00,000/- and a bond for Rs. 10,00,000/- (these two amounts being in lieu of any possible imposition of penalty) in favour of the respondents, as prescribed under the Customs Act or the Rules framed thereunder, the respondents shall release the seized gold in favour of the petitioner. The format of the Bank Guarantee and bond shall be communicated by the respondents to the learned Advocate-on-Record of the petitioner latest by 15th February, 1999. The release of the gold shall be effected within one week from the date of the aforesaid amount is paid, the Bank Guarantee and the bond are furnished. 2. The adjudication proceedings in all respects shall be completed within three months from today and final order passed during this period. 3. If the respondents do not complete the adjudication proceedings and pass the final order within three months from today, the petitioner shall become entitled to the refund of the aforesaid amount of Rs. 3,26,560/- with interest at the rate of 18% per annum. The Bank Guarantee and the bond furnished by the petitioner shall also immediately stand discharged at the expiry of the three month's period. 4. The petitioner shall fully cooperate with the respondents in the adjudication proceedings. If the petitioner fails to cooperate in such proceedings, after giving one notice of their intention to do so, the respondents shall be at liberty to proceed ex parte in the matter. The respondents shall also be at liberty to seek appropriate directions from this Court, if any necessity so arises. ( 8 ) SINCE no affidavit-in-opposition is filed by the respondents, nothing stated in the writ application shall be deemed to be admitted by them. ( 9 ) THE writ application finally disposed of.