Demand of differential duty

[MK Singh]

1. My question is when any case is book by the Customs, under which section differential duty may be demanded in case of undervaluation and misclassification, when SCN is given u/s 124 of the Customs Act, 1962?

2. If only IGM is filed and BE has not filed by the importer; can the person who booked the cargo can be liable for penalty if it contains any restricted goods/prohibited goods? Please quote any relevant judgement in this case, if possible?

[YAGAY and SUN]

Restricted goods can only be imported/exported after getting the authorization and the consent from appropriate Ministry. The prohibited goods cannot be imported/exported at all. Therefore, liable to be confiscated and penalty/compounding fee must be levied.

[Raghunandhaanan rvi]

If the imported goods are misclassified or mis-declared, such goods are liable for confiscation under Section 111(m) of the CA'62 and impose a penalty under section 112(a) of CA'62.

In the case the value of imported goods is undervalued, that value can be rejected by customs under Rule 12 of the CVR 2007 and proceed to re-determine the value in accordance to rule 4 to 9 sequentially. thereafter the importer is liable to pay the duty on the redetermined value of goods.

Customs demand notice can be issued under section 28 of the Customs Act 1962.

AI Summary

Confiscation and penalty follow for misclassification, undervaluation, and import of restricted or prohibited goods under customs law.
Misclassification or misdeclaration of imported goods renders them liable to confiscation and penalty; restricted goods require prior authorization while prohibited goods are barred and subject to confiscation and penalty or compounding. Suspected undervaluation permits customs to reject declared value and re-determine assessable value under valuation rules, after which customs may issue demand notices for differential duty based on the redetermined value.