Misdeclaration of export value does not by itself justify confiscation without a statutory export prohibition.

A misdeclaration of export value does not, by itself, create a prohibition or restriction on export so as to attract confiscation under clause (d) of section 113 of the Customs Act, 1962. The note states that Section 11 of the Foreign Trade (Development and Regulation) Act, 1992 and the Foreign Trade (Regulation) Rules, 1993 do not convert a value declaration lapse into a confiscatory violation, and Rule 17 does not authorise confiscation on that basis. On valuation, the department's evidence and the exporter's cost statement were both found unsatisfactory, so the DEPB-related value question required fresh determination by the Commissioner on fuller evidence.

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Issues: (i) whether the export consignments were liable to confiscation under customs law on the ground of misdeclaration of value and alleged prohibition under the foreign trade regime; (ii) whether the declared value for DEPB credit required fresh determination on the evidence.

Issue (i): Whether the export consignments were liable to confiscation under customs law on the ground of misdeclaration of value and alleged prohibition under the foreign trade regime.

Analysis: Confiscation under clause (d) of Section 113 of the Customs Act, 1962 applies only where export is attempted contrary to a prohibition imposed by or under the Act or any other law. A mere incorrect declaration of value under Rule 11 of the Foreign Trade (Regulation) Rules, 1993 does not by itself amount to a prohibition or restriction on export. Section 11 of the Foreign Trade (Development and Regulation) Act, 1992 and the related rules were held not to convert such a declaration lapse into a confiscatory violation, and Rule 17 was noted as not providing confiscation on that basis.

Conclusion: The confiscation of the goods, and the consequential fine and penalty, were not sustainable.

Issue (ii): Whether the declared value for DEPB credit required fresh determination on the evidence.

Analysis: The material relied upon by the department on valuation was found unsatisfactory, while the assessee's cost statement was also not adequately supported. In these circumstances, the valuation of the shirts and the present market value relevant to DEPB credit required reconsideration on a fuller evidentiary basis before the Commissioner, after giving both sides an opportunity to adduce material and after drawing representative samples.

Conclusion: The valuation issue was remanded to the Commissioner for fresh adjudication.

Final Conclusion: The appeal succeeded on confiscation and penalty, and the valuation question affecting DEPB credit was sent back for fresh determination; export of the goods was not treated as prohibited.

Ratio Decidendi: A misdeclaration of value in export documents does not, without a statutory prohibition or restriction on export, justify confiscation under clause (d) of Section 113 of the Customs Act, 1962.

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