TaxTMI 
TaxTMI 
2014 (2) TMI 974
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....ot as per invoice, PL and BL attached. The goods are bulky, packed in the pallets and are unbranded. It cannot be ascertained " whether they are defective or not". Further visually they appeared to he old but unused ....... to see the goods." 2. Thereafter the goods were examined by the Deputy Commissioner who remarked as under .- "Goods are new and prime they are not stock lot. Valuation may be carried out accordingly." 3. Based upon the above observation of the Deputy Commissioner, Revenue entertained a view that description of the goods in the invoice is not correct as also the classification of same under heading 8540 4000 is not correct. The goods are properly classifiable under heading 8540 0090 and chargeable to customs duty at the rate of 12.5%. Accordingly, the matter was taken up for adjudication by the Additional Commissioner of Customs, who observed that inasmuch as the wrong classification was claimed by the importer and the goods were not stock lot and were new goods as observed by the Deputy Commissioner (Shed), the same were also undervalued. He accordingly, enhanced the value of the goods on the basis of NIDB data. Accordingly, vide his order, he co....
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.... for the Revenue and after going through the impugned order, we find that admittedly first examination report conducted on 9.1.06 is to effect that visually the goods appeared to be old but unused. However, the second report of the Deputy Commissioner is to the effect that goods are new and they are not 'stock lot'. We find that Deputy Commissioner examined the goods visually. Except the said report of the Deputy Commissioner, every other documents i.e. the invoices raised by the supplier, packing list as also the BL describing the goods as stock lot. From the facts on record, we find that goods are of various sizes and of various numbers. The invoices raised by the supplier also reflects upon the value of each and every item. Revenue has not adduced any evidence to show that value of the said goods as reflected in the suppliers invoice is not the correct value. Comparing the same with NIDB data, where the goods were unbranded goods and there is no disclosure by the lower authorities as regards the brand name of the goods entered in NIDB data is neither appropriate nor proper. 8. In any case and in any view of the matter, we find that it stand held by various Courts that the charg....
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....sition of penalty of Rs.1.50 lakhs, we set aside the same and allow the appeal to the above extent. (Pronounced in the open court on --------) Per: Manmohan Singh: 13. I have gone thorough draft order recorded by learned Member (Judicial). I have also examined the various aspects and I am not in agreement with the decision and finding recorded. I therefore record separate order as under :- 14. Facts recorded in para 5 of the order proposed by learned judicial member, itself speak that there was realisation of higher value of misdeclared goods by customs through auction, Rs.10 lakh realised by auction was nearly two and a half times of the declared value. This speaks for itself that declared value of Rs.4.18 lakh was deliberate misdeclaration when declared value was Rs.4.18 and value realised was Rs.10 lakh. Profit margin of 250% is inconceivable. Thus valuation by customs does not have any room for doubt of any arbitrariness. The appellant failed to make true declaration and invoices produced showed branded goods as per invoices on record with different specification were imported. Burden was on importer to prove that declaration of description and value was truthful. NIAB data....
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....classifiable under chapter heading 8540 0090 attracting duty of 12.5%. Assessment order no. 42/2006 dated 07.12.2006 has truly described the nature, uses and various specifications of Data/Operator display tube colour with a phosphor dot screen pitch smaller than 0.4 mm. No catalogue was produced by the party to verify above characteristics . Also no description was mentioned in import invoice. Goods' description was misdeclared to claim wrong classification under 85404000 since the basic customs duty under this CTH was nil by tariff. Goods were actually classifiable under CTH 85401190 and Basic Customs duty chargeable was @ 12.5% Importer accepted during the personal hearing on 24.01.2006 before Commissioner, that CRT imported by them are meant to be used in colour TVs. There was clear admittance of misdeclaration . 20. Invoices on record show import of branded goods though in examination these are described as unbranded goods. Appellants have attempted to evade duty by way of mis declaration of the import. Once misdeclaration as to value, and classification is found, appropriate duty became payable with other consequences of law. Plea that it was only wrong classification and no....
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.... of such an act, shall be liable, - (i) in the case of goods in respect of which any prohibition is in force under this Act or any other law for the time being in force, to a penalty not exceeding three times the value of the goods as declared by the exporter or the value as determined under this Act, whichever is the greater; (ii) in the case of dutiable goods, other than prohibited goods, to a penalty not exceeding the duty sought to be evaded or five thousand rupees, whichever is the greater; (iii) in the case of any other goods, to a penalty not exceeding the value of the goods, as declared by the exporter or the value as determined under this Act, whichever is the greater." 25. In view of above, I hold that penalty of Rs.1.5 lakh has been righty imposed on the appellants and that is upheld. No order for redemption fine is required as appellants have abandoned goods. DIFFERENCE OF OPINION Whether there was delibate misdeclaration of classification and description as well as value inviting penal provisions were section 114 of Customs Act, 1962 as held by Hon'ble Member (Technical) or penalty is to be set aside as held by Member (Judic....
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....y are not stock lot . Accordingly, the value of the goods was ascertained on the basis of NIDB data and according to the department on the basis of 4 bills of entry No.543737 dated 18/10/06, 543006 dated 16/10/06, 544348 dated 23/10/06 and 943055 dated 27/10/06, the correct value of the goods should be Rs.15 ,88,420 /- against declared value of Rs.4,81,003 /-. The matter was adjudicated by the Additional Commissioner vide order-in-original dated 07/12/06 held that the description as well as the value of the goods has been misdeclared and, hence, the goods are liable for confiscation under Section 111(m) of the Customs Act, 1962 and accordingly ordered their confiscation with option to be redeemed on redemption fine of Rs . 3,00,000/-. Beside this, he also imposed penalty of Rs . 1,50,000/- on the appellant under Section 112(a) and also ordered the assessment of duty on the loaded value of Rs.15 ,88,420 /-. The appeal filed by the appellant against the Additional Commissioner's order was dismissed vide order-in-appeal dated 14/12/07 against which this appeal has been filed. Since, the importer did not redeem the goods on payment of the duty on the loaded value, redemption fine and p....
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....f entry with intent to evade the duty, as the invoices issued by the supplier mentioned the goods as stock lot of colour picture tubes and the invoices had been presented by the appellant to the customs authorities, that mention of the words "data graphic display tubes colour with phosphor dot screen pitch smaller than 0.4 mm" in the bill of entry and their classification under sub-heading 85404000 was due to mistake on the part of the CHA and the same cannot be treated as deliberate mis -declaration of description with intent to evade the duty, that just because the classification of the goods was claimed under sub-heading 85404000, where the rate of duty is nil, it cannot be concluded that this had been done with intent to evade the duty by mis -classification, as the invoices mentioned the description of the goods as stock lot of colour picture tubes and these invoices had been presented, that there is no dispute that the goods are unbranded goods of Singapore origin, that the declared value of Rs.4,81,003 /- CIF has been arbitrarily enhanced to Rs . 15,88,420/- CIF on the basis of four bills of entry mentioned in NIDB data pertaining to import of colour picture tubes during Oct....
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.... description as data/graphic display tubes colour with phosphor dot screen pitch smaller than 0.4 mm by writing these words within brackets after the words " colour picture tubes", that since the assessment is online, in normal course, the goods would have been assessed at nil rate of duty as data graphic tubes under sub-heading 85404000 if the shed appraiser had not referred the bill of entry back to the group for verification of the description, that this Act of the appellant amounts to deliberate mis -declaration of description with intent to evade the duty, that as regards the value, the declared value has been rejected, as it is far too low as compared to contemporaneous imports of identical goods in comparable quantity, the information about which was obtained from NIDB data and that the deliberate mis -declaration of description and value has rendered the goods liable for confiscation and, hence, notwithstanding the fact that the appellant have chosen not to clear the goods, penalty under Section 112(a) of Customs Act, 1962 would be attracted. 31. I have considered the submissions from both the sides and perused the records. 32. The only point to be decided in this case is....
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....ion of the goods had been deliberately mis -declared with intent to evade the duty so as to attract the provisions of Section 111(m). 34. As regards mis -declaration of value in the invoices as well as in the bill of entry, as in the invoices as well as in the bills, the same are mentioned as stock lot of colour picture tubes though in the bill of entry after the words "stock lot of colour picture tubes", the words "data/graphic display tubes colour with phosphor dot Screen pitch smaller than 0.4mm " has also been added. On examination the goods were found to be unbranded colour picture tubes. Though while Deputy Commissioner was of the view goods are not stock lot, the lower officer who examined the goods had opined that the goods are stock lot. It is also seen that both the Deputy Commissioner as well as the lower officer during examination found that the goods are unbranded. The stock lot goods are those which are sold as clearance sale for the reason that the stockist wants to get rid of the goods at the earliest for various reasons, like the goods are not moving are no longer in demand or have become obsolete. Therefore, when the importer's claim that the goods are stock lot ....