2002 (5) TMI 610 - AT - Central Excise

Customs Appeal Decision: Goods correctly declared as ball retainers; penalty reduced.

The appellants appealed against a Customs adjudication order for mis-declaration of goods as steel balls when they were actually steel ball retainers, ... Confiscation and Penalty Issues: Mis-declaration of goods, DEPB Credit eligibility, Confiscation of goods, Imposition of penalty, Adjustment of excess payment, Reduction of penaltyIn this case, the appellants filed an appeal against the adjudication order passed by the Commissioner of Customs regarding the mis-declaration of goods. The appellants declared the goods as steel balls in the shipping bills, but upon examination, it was revealed that the goods were actually steel ball retainers. The appellants had exported similar goods in previous assignments under the guise of steel balls and availed DEPB Credit. The Revenue pointed out that the DEPB Credit was only applicable to steel balls, not retainers. The appellants deposited the amount in question without protest. A show cause notice was issued for confiscation of the goods, imposition of penalty, recovery of Special Additional Duty (SAD), and interest on past clearances. The adjudicating authority ordered confiscation of the goods, disallowed the DEPB Credit, demanded SAD, and imposed a penalty under Section 114 of the Customs Act.The main contention of the appellants was that the goods were only steel balls contained in a cage, thus no mis-declaration had occurred. They argued that as steel balls were eligible for DEPB Credit, the order was unsustainable. The appellants also claimed that the demand for DEPB Credit on earlier consignments was time-barred and cited a relevant Tribunal decision. However, it was established that the goods were commercially known as ball retainers, used as components in bicycles, and not just steel balls. The product literature described the goods as ball retainers, specifically used as bearings in bicycle parts. Therefore, the denial of DEPB Credit and confiscation of the goods were upheld.Regarding the disallowance of credit on earlier consignments, the appellants argued that they had paid in excess and requested an adjustment against the amount paid. The adjudicating authority allowed the adjustment from the excess amount, which the appellants did not contest. As this issue was not disputed before the authority, the arguments were found to lack merit. The penalty imposed under Section 114 of the Customs Act was reduced to Rs. fifty thousand considering the facts and circumstances of the case, while the rest of the impugned order was upheld.