2018 (9) TMI 1287 - AT - Customs

Tribunal overturns decision, favors appellant based on lack of intent to mis-declare; assessable value not properly established.

The Tribunal set aside the decision of the Commissioner(Appeals) and allowed the appeal in favor of the appellant. The Tribunal relied on a precedent ... Valuation of imported goods - Aluminium scrap classified as tough/taboo - goods were not of prime quality - enhancement of value - appellant’s contention is that the slabs found by the officers were not of prime Aluminium and the same were in the nature of scrap - is enhancement of value justified? Held that:- An identical case of the same assessee was dealt by the Tribunal in the case of Vardhaman Sales Agency [2018 (3) TMI 563 - CESTAT ALLAHABAD], where, the charges of mis-declaration and the consequent enhancement of value were set aside by holding that there is no intention of the appellant to mis-declare the goods for the reason that the appellant under-took to mutilate the goods which were objected to be of prime nature by Revenue. Appeal allowed - decided in favor of appellant. Issues involved:1. Mis-declaration of imported goods as scrap.2. Allegation of importing slabs of prime Aluminium instead of scrap.3. Confiscation of goods, imposition of penalties, and enhancement of value.4. Applicability of precedent decisions by the Tribunal.Detailed analysis:1. The appellant imported a consignment of Aluminium scrap declared as tough/taboo as per ISRI from M/s. Dubai Scrap Trading, Sharja, UAE. The Bill of Entry declared the goods as scrap with a value of USD 2060 per MT. However, upon physical examination, it was found that a portion of the consignment was slabs of prime Aluminium, leading to allegations of mis-declaration by the revenue authorities.2. The revenue initiated proceedings against the appellant, alleging mis-declaration of description and value, leading to the enhancement of value and differential duty of &8377; 87,043. The goods were also confiscated with an option for redemption on payment of fines and penalties under the Customs Act. The appellant contended that the slabs were wrongly identified as prime Aluminium and were actually scrap, based on the invoice from the foreign supplier.3. The appellant argued that the customs officers lacked expertise to determine the nature of the goods and requested mutilation if satisfaction was not met. They also disputed the justification for enhancing the value, stating no extra payments were made to the foreign supplier. The Commissioner(Appeals) upheld the original adjudicating authority's decision, leading to the present appeal challenging the confiscation, penalties, and value enhancement.4. The Tribunal referred to a precedent decision involving the same assessee, where similar charges of mis-declaration were set aside. The Tribunal observed that the goods were declared as per documents received from the foreign supplier, indicating no intention to mis-declare. The Tribunal highlighted the requirement to establish assessable value based on actual price paid, which was not done in the present case. Consequently, the impugned order was set aside, and the appeal was allowed in favor of the appellant based on the precedent decision.This detailed analysis of the judgment highlights the issues of mis-declaration, confiscation, penalties, and the application of precedent decisions by the Tribunal in resolving the dispute regarding the imported goods.