Scrap declaration evidence controls over visual inspection; mutilation allowed and confiscation-linked penalties fall away without proven misdeclaration.

Contemporaneous invoices, a high seas sale agreement and uncontroverted buyer evidence supported declaration of the imported goods as scrap intended for melting. A bare physical examination was held insufficient to displace that documentary position without reliable proof of misdeclaration, so the benefit of doubt remained with the importer. Once misdeclaration was not sustained, the restriction on mutilation of misdeclared goods did not apply, and the confiscation, redemption fine and penalty founded on that allegation could not survive. Mutilation was therefore permitted and the consequential liabilities were set aside.

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Issues: Whether the imported goods were misdeclared as scrap and, if not, whether the assessee was entitled to mutilate the goods and obtain consequential relief against confiscation, redemption fine and penalty.

Analysis: The goods were described in the supplier's invoices and in the high seas sale agreement as scrap intended for melting, and the buyer's statement confirming the melting purpose was not retracted or contradicted. The physical examination relied upon by the department was not treated as conclusive proof that the entire consignment consisted only of serviceable goods, and the benefit of doubt on the character of the goods was given to the importer. Since the finding of misdeclaration was not sustained, the prohibition against mutilation of misdeclared goods did not apply. The confiscation and penalty were founded entirely on the alleged misdeclaration, and once that foundation failed, the consequential liabilities could not survive.

Conclusion: The goods were not held to be misdeclared, mutilation was permitted, and the confiscation, redemption fine and penalty were set aside.

Ratio Decidendi: Where the contemporaneous commercial documents and uncontroverted buyer evidence support declaration of goods as scrap, a bare visual inspection cannot displace that declaration without reliable proof of misdeclaration; consequential confiscation and penalty cannot stand, and mutilation may be allowed.

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