Reasonable valuation for short-landed goods reduced the customs penalty after the evidence was accepted on record.

In a revision concerning penalty for short-landing of goods under the Customs Act, the valuation of missing packages had to be reassessed on a reasonable basis in light of the evidence produced. Packing lists, invoices and related material could not be ignored, and the figure adopted earlier was not shown to have been worked out clearly or reasonably. An average-basis valuation of the short-landed cases was accepted, and the penalty was reduced accordingly, with relief granted to the party to that extent.

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Issues: Whether, in a revision arising out of penalty imposed for short-landing of goods under Section 116 of the Customs Act, 1962, the value of the missing packages and the consequential penalty were required to be reassessed on a reasonable basis in light of the evidence produced by the party.

Analysis: The evidence furnished by the party, including packing list, invoice and other relevant material, could not be ignored outright. The valuation of the short-landed packages had not been shown to have been worked out on a clear or reasonable basis, and the party was entitled to know how the figure had been arrived at. On the material available, an average basis valuation of the short-landed cases was accepted, and the duty relatable to such valuation was found to be Rs. 19,907.

Conclusion: The penalty was reduced to Rs. 19,907 and confirmed only to that extent, with consequential relief to the party.

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