Appellate Tribunal Confirms Confiscation of Misdeclared Ferro Silicon, Penalties Overturned

The Appellate Tribunal upheld the confiscation of 2169 MT of Ferro Silicon (FeSi) exported by the Appellant for misdeclaration of origin, allowing the recovery of import duties foregone. However, penalties under Sections 114 and 114AA imposed on the Appellant and its Director were set aside as the Directorate General of Foreign Trade had already imposed penalties for the same violation. The Appeals were disposed of accordingly.

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Issues:
- Whether 2169 MT of FeSi exported by the Appellant are liable for confiscationRs.
- Whether an amount equivalent to import duties foregone due to imports made by different importers on the strength of the DEPB Scrip's purchased from the Appellant can be recovered from the Appellant along with interestRs.
- Whether penalties under Section 114 and 114AA imposable on the Appellant and its Director separately for the same offenceRs.

Issue 1:
The Appellant exported Ferro Silicon (FeSi) under DEPB claims, declaring them as Indian origin. The department alleged that the goods were actually of Bhutanese origin. Statements from suppliers confirmed the FeSi was of Bhutanese origin, even those procured from the Indian market. The exported goods were found to be of Bhutanese origin, leading to the confiscation of 2169 MT of FeSi.

Issue 2:
The Appellant processed the exported goods before export, but the processing did not meet the required value addition criteria to change the country of origin. The Appellant admitted to not meeting the value addition requirement, leading to a misdeclaration of the country of origin as 'India'. As a result, the confiscation of 2169 MT of FeSi was deemed legally valid.

Issue 3:
The DGFT imposed a penalty on the Appellant, indicating acceptance of mis-declaration. Citing previous decisions, penalties under Sections 114 and 114AA were found not sustainable as DGFT had already imposed penalties for the same violation. Therefore, penalties imposed on the Appellant and its Director were set aside.

In conclusion, the Appellate Tribunal upheld the confiscation of FeSi, allowed the recovery of import duties foregone, and set aside penalties under Sections 114 and 114AA imposed on the Appellant and its Director. The Appeals were disposed of accordingly.

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