2007 (11) TMI 251 - AT - Customs

Tribunal Upholds Order Modification on DEPB Benefit Denial

The Tribunal upheld the modification of the order by the Commissioner (Appeals) regarding confiscation and denial of DEPB benefit. The appeal by the ... Sample test - test report conclusively shows that the item analysed did not conform to alloy steel as per the test certificate – out of four items sample was taken only of one item – held that test result could not have automatically applied to other three articles of serial no. 8 - respondent at no point of time admitted that the description in respect of other items was incorrect – confiscation of other three items, on basis of test report of sample of another one item is not justified Issues:1. Appeal against modification of order regarding confiscation and denial of DEPB benefit.2. Justification for modifying the order of the adjudicating authority.3. Interpretation of test report and dictionary definitions regarding steel alloy.4. Application of test report to different articles under the same serial number.5. Validity of modifying the order based on the test report and evidence.Analysis:1. The appeal was filed by the Revenue against the modification of the order by the Commissioner (Appeals) regarding the confiscation and denial of DEPB benefit. The original order included confiscation of specific export goods, denial of DEPB benefit, and imposition of a penalty under the Customs Act, 1962.2. The Department's representative argued that the modification was unjustified as it was based on valid reasons and evidence. The sample test was conducted on an item selected by the respondent, and the test report indicated non-conformance to alloy steel specifications. Reference was made to a technical dictionary to support the definition of steel alloy and steel carbon.3. The respondent's counsel contended that the test was limited to one of the four articles covered under the same serial number in the shipping bill. It was argued that the test report for one article could not be applied to the other articles, justifying the modification of the order by the Commissioner (Appeals).4. The sample for testing was chosen by the respondent, and it was noted that only one of the four articles under the same serial number was tested. The test report's applicability was questioned for the other three articles listed as alloy steel forging. The Tribunal emphasized that the test report for one article could not automatically apply to the other articles without individual testing.5. The Tribunal concluded that the modification of the order was justified based on the evidence and the specific nature of the sample tested. It was noted that the respondent did not admit the incorrectness of the description for the other items, and the Revenue took a risk by not testing all articles under the same serial number. The decision to uphold the modification was deemed reasonable and supported by the material on record, leading to the dismissal of the Revenue's appeal.