1999 (8) TMI 365 - AT - Customs

Tribunal Rules Over-valuation Not an Offence

The Tribunal allowed the appeal, ruling that over-valuation in the exports did not constitute an offence under FERA. Consequently, the confiscation of ... Export Issues involved: The issues involved in the judgment are over-valuation in exports, violation of Section 18(1)(a) read with Section 67 of FERA, confiscation of goods under Section 113(d) of Customs Act, imposition of penalty under Section 114 of Customs Act, and the interpretation of legal provisions regarding over-invoicing as an offence under FERA and Customs Act.Details of the Judgment:1. Over-valuation in exports and violation of FERA and Customs Act: The ld. Commissioner of Customs found that over-valuation in exports is a violation of FERA and Customs Act. The unit attempted to export goods with a significant difference between the declared value and the actual value. This contravened Section 18(1)(a) of FERA, leading to the imposition of penalties under the Customs Act.2. Confiscation of goods and penalty imposition: The appellants filed a Shipping Bill for export of Computer Software, which raised doubts about the software's value. The matter was referred to authorities who confirmed the over-valuation. A show-cause notice was issued, and the appellants argued that over-valuation is not an offence under FERA or Customs Act. However, the Commissioner held that misdeclaration of value is an offence under FERA, leading to confiscation of goods under Section 113(d) of Customs Act and imposition of penalties under Section 114.3. Interpretation of legal provisions: The appellants contended that over-valuation is not an offence under Section 18(1)(a) of FERA, citing relevant case law. The Commissioner and the DR argued that misdeclaration of value constitutes an offence under FERA and Customs Act. The Tribunal analyzed the conflicting decisions and ruled that over-invoicing, in this case, is not an offence under FERA, thus rendering the confiscation of goods and penalty imposition unsustainable in law.Conclusion: The Tribunal allowed the appeal, stating that over-invoicing in the present case is not an offence under FERA, thereby invalidating the confiscation of goods and penalty imposition. Consequential relief, if any, was directed to be granted to the appellants in accordance with the law.