TaxTMI 
TaxTMI 
1999 (8) TMI 365
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....een made out against the unit inasmuch as huge sums through two related persons are sought to be transacted by the channel of software export. I am also not convinced of the view that ERDCI is not competent to value software. As discussed, there is a violation of Section 18(1) (a) read with Section 67 of FERA. It is mandatory for the unit to furnish correct declaration under FERA before attempting any export and Section 48 of FERA requires that every declaration under FERA must be a correct declaration. A false declaration has contravened Section 18(1)(a) and hence attracts the provision of Customs Act. Goods in this case i.e. one CD containing software sought to be exported have become prohibited goods in terms of FERA, which prohibition i....
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....38,05,350/-. A SCN was issued to the appellants asking them to explain as to why the compact disc containing computer software should not be confiscated under Section 113 of Customs Act read with Section 18 of FERA and why penalty should not be imposed under Section 114 of the Customs Act for over-valuation of the goods. The appellants in reply to the SCN submitted that over-valuation of goods meant for export is not in offence under under Section 132 of the Customs Act read with Sections 18 and 67 of FERA; that the unit has signed a correct declaration; that the software was neither dutiable nor prohibited; that punishment cannot be inflicted under Section 132 by the Customs Authorities; that under Section 18 of FERA only realisation of fu....
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....on 14. He submitted that Section 18(1)(a) requires that exporter shall furnish to the prescribed authority a declaration in the prescribed form which among other things shall include the amount representing full export value of the goods. He submitted that the Hon'ble Calcutta High Court in the case of M/s. Lexus Exports Pvt. Ltd. Held "It is best a case of overinvoicing and not a case of under invoicing. Therefore, there is no violation of Section 18(1) (a) of FERA in the instant case". Ld. Consultant further submitted that the relevant Section of FERA is Section 67 which provides : "The restrictions imposed by or under Section 13, Clause (a) of sub-section (1) of Section 18 and Clause (a) of sub-section (1) of Section....
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....n under Section 113(d) was not warranted. Ld. Consultant therefore, submitted that the position being very clear the confiscation of the goods and imposition of penalty was not warranted and therefore, prayed that the impugned order may be set aside and the appeal may be allowed. 5. Shri T.A. Arunachalam, ld. DR submits that Shri Diwakar Mishra, Manager of the Unit in his statement recorded on 22-10-1998 stated that there was a manipulation to the extent of 20% and the software was over-invoiced to earn more profit, that their foreign client is a NRI a known associate and therefore, they had no problem in arranging foreign remittance. He submitted that when this statement is read with the expert opinion given by the Electronic Resea....
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....ted by the appellants and two decisions have been cited by the respondent. In the decision cited by the appellants which was given by the Hon'ble Calcutta High Court we find that the Hon'ble High Court has ruled that over-invoicing is not an offence under Section 18(1)(a) of FERA whereas in the case relied upon by the respondent there is a decision of the Hon'ble Calcutta High Court in the case Tosh & Sons cited above, wherein it has been held that the particulars given in the declaration are not true or correct in all respects immediately under Section 18 is attracted and there is a violation of the said Act. We note that this decision cited by the respondent pertains to under-invoicing and therefore, is distinguishable inasmuch as the cas....