Appeal partially allowed, redemption fine and penalty set aside. Lack of evidence for mis-declaration. Supplier information relied upon.

The tribunal partially allowed the appeal, setting aside the redemption fine and penalty imposed on the appellant. The judgment emphasized the lack of evidence supporting deliberate mis-declaration and highlighted the appellant's reliance on supplier information regarding thickness variation.

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Issues:
1. Assessment of PU leather thickness under Customs Valuation Rules, 2007
2. Confiscation of goods and imposition of redemption fine and penalty
3. Application of NIDB data for valuation
4. Contestation of mis-declaration and imposition of fine and penalty

Assessment of PU Leather Thickness:
The primary issue in the case was the assessment of PU leather thickness under the Customs Valuation Rules, 2007. The appellant had declared the thickness as 0.5 mm and 0.9 mm, but during examination, it was found to be 0.65 mm and 1.2 mm, respectively. The adjudicating authority determined the value based on the actual thickness found, leading to enhanced assessable value and subsequent penalties.

Confiscation and Imposition of Fine and Penalty:
The adjudicating authority ordered the confiscation of the goods under Section 111(m) of the Customs Act, 1962, due to mis-declaration of thickness. The appellant was given the option to redeem the goods by paying a fine of Rs. 3.50 lakhs and a penalty of Rs. 70,000 under Sections 125 and 112(a)(ii) of the Customs Act, respectively. The appellant contested these penalties, arguing lack of deliberate mis-declaration and citing the possibility of thickness variation as per supplier invoices.

Application of NIDB Data for Valuation:
The appellant challenged the use of NIDB data for valuation, contending that it was not a reliable basis. However, the adjudicating authority justified the enhanced value determination based on contemporaneous imports of similar goods with the actual thickness. The tribunal found this approach in line with Rule 12 of the Customs Valuation Rules, 2007, and upheld the valuation method.

Contestation of Mis-Declaration and Penalties:
The appellant vehemently argued against the fine and penalty, claiming no deliberate intention to mis-declare and attributing the discrepancy to supplier information. The appellant's waiver of show cause notice and hearing was explained as an attempt to expedite clearance and avoid demurrage. The tribunal observed no evidence of deliberate mis-declaration and noted that similar cases had resulted in the setting aside of redemption fine and penalty.

In conclusion, the tribunal partially allowed the appeal by setting aside the redemption fine and penalty imposed on the appellant. The judgment emphasized the lack of evidence supporting deliberate mis-declaration and highlighted the appellant's reliance on supplier information regarding thickness variation.

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