TaxTMI 
TaxTMI 
1995 (4) TMI 169
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....d at Rs. 11,48,44,574 and which on examination were found to be either scrap or not conforming to the quality declared and were valued at Rs. 3,38,480, for gross over-valuation of the goods under Section 113(d) of the Customs Act and has held the applicants to be liable to penalty under Section 114(i) of the Customs Act, 1962. 3. The learned Consultant for the applicants has pleaded that he is not raising any issue in regard to the facts brought out in the order of the learned lower authority but is confining his plea only to the legal aspect. His plea is that the goods notwithstanding the misdeclaration could not be confiscated under the provisions of Section 113(d) of the Customs Act. He referred us to the provisions of this section and Section 113(d) for convenience of reference is reproduced below : "113. Confiscation of goods attempted to be improperly exported, etc. - The following goods shall be liable to confiscation - ........... (d) any goods attempted to be exported or brought within the limits of any customs area for the purpose of being exported, contrary to any prohibition imposed by or under this Act or any other law for the time being in f....
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....he action that could be taken where the goods, which are not prohibited and are also non-dutiable, are exported and the value declared was too high as the Government with a view to get foreign exchange might have chosen to turn the Nelson's eye in case of such exports. It was put to the learned Consultant that if what he stated is accepted, that would tantamount to accepting that the Government is condoning the hawala transaction for repatriation of foreign exchange arranged through unauthorised channels as in the case of over-valued goods the applicants will have to repatriate the value declared which the goods would not be fetching. A pleas was made by the learned Consultant that in terms of Section 114(i) the maximum penalty that could be levied is five times the value of the goods and that since the value of the goods has been ascertained by the authorities as Rs. 3,38,480 the penalty could be only leviable taking into consideration this value and not the declared value of Rs. 11,48,44,547. The learned Consultant also pleaded that the applicants had entrusted the work of exporting the goods to one Shri Arora and it was he who had arranged for the purchase, packing and despatch ....
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....stoms Act is compliance with the provisions of Section 50. Section 50(2) casts the following obligation on the applicants in regard to the declaration : "(2) The exporter of any goods, while presenting a shipping bill or bill of export, shall at the foot thereof make and subscribe to a declaration to the truth of its contents." This requirement of declaration has also to be read with the declaration required for export purposes under Section 18(1) of the Foreign Exchange Regulation Act, 1973. We observe that in respect of the export goods the requirement of Section 18(1)(a) of the Foreign Exchange Regulation Act, 1973 has also to be complied with. Section 18(1)(a) of the Foreign Exchange Regulation Act is reproduced below for convenience of reference : "18(1)(a) The Central Government may, by notification in the Official Gazette, prohibit the taking or sending out by land, sea or air (hereafter in this section referred to as export) of all goods or of any goods or class of goods specified in the notification from India directly or indirectly to any place so specified unless the exporter furnishes to the prescribed authority a declaration in the prescribed form su....
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....ause (a) of sub-section (1) of Section 19 shall be deemed to have been imposed under section 11 of the Customs Act, 1962 (52 of 1962), and all the provisions of that Act shall have effect accordingly." The particulars of the goods furnished by the applicants as also the value furnished have not been found to be correct and, therefore, the applicants' export was prima facie in violation of Section 18(1)(a) read with the Notification No. F. 1/67/EC/73-1, dated 1 January, 1974 issued under the said Section and read with Section 67 of the Foreign Exchange Regulation Act extracted above. Now the restriction has been interpreted to be a prohibition for the purpose of the Customs Act, 1962. In the above view of the matter, therefore, it has to be held prima facie that the goods sought to be exported were prohibited goods in terms of the Foreign Exchange Regulation Act and in violation of the requirements of the Customs Act under Section 50(2). We, therefore, hold that the goods prima facie are liable to confiscation under Section 113(d) of the Customs Act, and the applicants, therefore, will become liable to action under Section 114(i) of the Customs Act, 1962. The applicants' plea tha....