TaxTMI 
TaxTMI 
2022 (8) TMI 237
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....e Order-in-Original No. 25/2020-21/Commr/NS-III/CAC/JNCH dated 02.07.2020 (for short referred to as the "impugned Order"), passed by Commissioner of Customs, JNCH, Nhava Sheva. 3. Brief facts of the case are that the appellants herein, M/s Jeen Bhavani International, imported 63 consignments of Linen Yarn, Ramie Yarn and other misc. items from various overseas suppliers, based in China; during the period between 01.08.2014 and 10.11.2016, the appellant filed bills of entry classifying the said goods under CTH 53061090 and 53089010; goods were assessed by the department and ordered for clearance of the same for home consumption, in terms of Section 17 of the Customs Act, 1962 (for short, referred to as the "Act of 1962"). On the basis of specific information received, indicating that the appellant indulged in gross under valuation of the imported goods, Directorate of Revenue Intelligence (DRI), Zonal Unit, Surat conducted a detailed investigation into the matter. Department issued a Show Cause Notice (SCN) proposing rejection of the declared value of goods in terms of Rule 12 of the Customs Valuation (Determination of Prices of the imported goods) Rules, 2007 (for short, r....
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....asmuch as the important aspects regarding the year of manufacture of the computer, model number, the exact location of the premise where the same was kept and more importantly, the statement was not recorded from the person, who operated the same, were not discussed by the lower authorities; further, there is no whisper in the Panchanama with regard to description of CPU, the location in the searched premises where it was installed and the manner in which it was seized; the data obtained from the mail id is contrary to the provisions of Section 138C ibid and that in absence of the statement recorded from the senders of the E-mails, validity of the same is at stake and cannot be relied upon as tangible evidence to prosecute the appellants. 4.1. With regard to the issue of retracted statements furnished by the appellants belatedly, she submits that there was no in-ordinate delay in filing the retraction statement inasmuch as copies of the statements recorded under summon were not furnished by the department immediately after signing of the same during the course of investigation; since the contents of the statements were made known to the appellant through the RUDs annexed t....
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....issioner, - 2016 (339) E.L.T. A 125 (Tri.-Mumbai) (e) S.N. Agrotech vs. Commissioner Of customs, New Delhi - 2018(361) E.L.T. 761 (Tri. - Del.) (f) Rajesh Gandhi vs. Commissioner Of Custom Mumbai - Import, 2019 (366) E.L.T. 529 (Tri. - Mumbai) (g) Century Metal Recycling Pvt. Ltd. Vs. Union of India - 2019 (367) E.L.T. 3 (S.C.) (h) Agarwal Metals & Alloys vs. Commissioner Of Customs, Kandla - 2021 (378) E.L.T. 155 (Tri. -Ahmd.) (i) Vinod Solanki vs. Union of India - 2009 (223) E.L.T. 157 (S.C.). 5. On the other hand, Shri Manoj Das, learned Authorized Representative appearing for Revenue reiterates the findings recorded in the impugned order and submits that the Panchanama drawn in this case on 10.11.2016 is the only piece of uncontroverted evidence, which has not been disputed by the appellant; the appellant in his statement recorded under summons has stated the detailed modus operandi adopted by the appellant in gross undervaluation of the goods and for that purpose, has voluntarily made payment of Rs. 42,00,000/-towards the differential duty, during the course of investigation; referring to the s....
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....ts received from the EDI Section/JNCH; Email messages retrieved from email account of Shri Mahesh Sharma; data recovered from CPU of Shri Mahesh Sharma by the Regional Forensic Science Lab., etc. 7. On perusal of the impugned order, it transpires that upon assessment of the disputed Bills of Entry by the proper officer, the subject goods were allowed for home clearance on payment of appropriate customs duties on the value declared by the appellant and that based on investigation conducted by the officers of DRI; the present proceedings were initiated by the department under Section 28 of Customs Act,1962, alleging undervaluation of goods, which ultimately has resulted in confirmation of the adjudged demands on the appellant. 7.1. Insofar as assessment of duty liability is concerned, Section 17 ibid through various sub-sections contained therein has provided inter alia, for self- assessment of duty leviable on the imported goods by the importer itself [sub-section (1)]; verification by the proper officer with regard to the entries made by the importer in the Bill of Entry in terms of Section 46 ibid and for that purpose, to examine or test the imported goods [sub-s....
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....ed from CPU of Shri Mahesh Sharma by the Regional Forensic Science Lab., to conclude that the charges framed in the SCN with regard to undervaluation of goods are proved and accordingly, the appellants are liable to pay the differential duty along with interest and are also exposed to the penal consequences as per the statute. 9. The provisions with regard to search of premises are contained in Section 105 ibid. It has been mandated that the provisions of Code of Criminal Procedure, 1898 relating to searches shall, as the case may be, apply to searches conducted under the Customs Act, 1962. The basic purpose and objective of drawing Panchanama has been made clear in Section 100(4) in the said code. As per the statutory mandates and the law laid down by the judicial forums, the purpose for drawing the Panchanama is to conveyance the court that the officer-in-charge has in fact carried out the investigation, search or seizure, if any, and have acted upon the directions of the court and guard the case from unfair dealings on the part of the officers. We find that the description, make, model, number, year of manufacturing etc. of the seized computer has not been furnished by ....
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.... tally with the admitted values admitted by the Appellant. 11. It is an admitted fact that during the course of investigation, the appellant had paid an amount of Rs.48,00,000/- which was appropriated in the impugned order towards duty liability in respect of 21 consignments. Such payments made by the appellant cannot be decisively linked with the differential amount between the re- determined values considered in the impugned order vis-a-vis as declared by the importer-appellant in the disputed Bills of Entry. Further, the person, residing in India, to whom the alleged amount was paid by the appellant, as claimed by the department, has not been questioned about the further disposal of money and ultimate payment to the foreign supplier; it could have been tangible evidence. No summonses were issued to either such person or the foreign supplier and no statements were recorded for ascertaining the fact or purpose of the payment of the alleged amount. Furthermore, since the appellant has retracted the statements recorded under summons issued on different dates, such retracted statements cannot be relied upon in isolation to conclude that the payment made during the course of ....
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....g the recording of the statement cannot be relied upon in the absence of corroborative evidence. 12. In this case, out of 63 consignments of the disputed goods imported by the appellant during the period between 01.08.2014 and 10.11.2016, the declared value of 42 consignments was accepted by the department and in respect of 21 consignments, such value was rejected solely based on the emails retrieved from the email address of the appellant. From the submissions made by the learned Advocate and on perusal of the records, we find that description of the goods mentioned in the invoices is different from the description contained in the email; the quantities of goods imported by the appellant were also different as mentioned in the email; that there is no allegation by the department that over and above the quantity mentioned in the commercial invoices, the appellant had imported any further goods reflected in the email's; the statement of the sender of the email was not taken nor was he cross examined in the manner provided in the statute. Therefore, the charges of undervaluation, without proper substantiation, would not meet the ends of justice in support of confirmation of ....
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.... the computer during the period over which the computer was used regularly to store or process information for the purposes of any activities regularly carried on over that period by the person having lawful control over the use of the computer; (b) during the said period, there was regularly supplied to the computer in the ordinary course of the said activities, information of the kind contained in the statement or of the kind from which the Information so contained is derived; (c) throughout the material part of the said period, the computer was operating properly or, if not, then any respect in which it was not operating properly or was out of operation during that part of that period was not such as to affect the production of the document or the accuracy of the contents; and (d) the information contained in the statement reproduces or is derived from information supplied to the computer in the ordinary course of the said activities. (3) Where over any period, the function of storing or processing information for the purposes of any activities regularly carried on over that period as mentioned in clause (a) of sub-sect....
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....d to that computer, shall be taken to be supplied to it in the course of those activities; (c) a document shall be taken to have been produced by a computer whether it was produced by it directly or (with or without human intervention) by means of any appropriate equipment. Explanation. - For the purposes of this Section, - (a) "computer" means any device that receives, stores and processes data, applying stipulated processes to the information and supplying results of these processes; and (b) any reference to information being derived from other information shall be a reference to its being derived there from by calculation, comparison or any other process. 8. On close reading of Section 138C of the Act, 1962, it is seen that the Legislature had prescribed the detailed procedure to accept the computer printouts and other electronic devices as evidences. It has been stated that any proceedings under the Act, 1962, where it is desired to give a statement in evidence of electronic devices, shall be evidences of any matter stated in the certificate. In the present case, we find that the provisions of Section 138C of ....
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.... media produced by a computer shall be deemed to be a document only if the conditions mentioned under sub-section (2) are satisfied, without further proof or production of the original. 15. Under Section 65B(4) of the Evidence Act, if it is desired to give a statement in any proceedings pertaining to an electronic record, it is permissible provided the following conditions are satisfied : (a) There must be a certificate which identifies the electronic record containing the statement; (b) The certificate must describe the manner in which the electronic record was produced; (c) The certificate must furnish the particulars of the device involved in the production of that record; (d) The certificate must deal with the applicable conditions mentioned under Section 65B(2) of the Evidence Act; and (e) The certificate must be signed by a person occupying a responsible official position in relation to the operation of the relevant device. 16. It is further clarified that the person need only to state in the certificate that the same is to the best of his knowledge and belief. Most import....
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....ence pertaining to that electronic record, is inadmissible." 11. Upon perusal of the judgment of the Hon'ble Supreme Court in the case of Anvar P.V. (supra), we note that the Apex Court has categorically laid down the law that unless the requirement of Section 65B of the Evidence Act is satisfied, such evidence cannot be admitted in any proceeding. We note that the Section 138C of the Customs Act is pari materia to Section 65B of the Evidence Act. Consequently, the evidence in the form of computer printouts, etc., recovered during the course of investigation can be admitted as in the present proceedings only subject to the satisfaction of the sub-section (2) of Section 138C. This refers to the certificate from a responsible person in relation to the operation of the relevant laptop/computer. After perusing the record of the case, we note that in respect of the electronic documents in the form of computer printouts from the seized laptops and other electronic devices have not been accompanied by a certificate as required by Section 138C(2) as above. In the absence of such certificate, in view of the unambiguous language in the judgment of the Hon'ble Supreme Court (su....
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....e relied upon for upholding the charges of undervaluation of goods and demand of the differential duty. 13. Further, Revenue relies on the fact that the insurance policies contracted by the appellants for the imports indicate higher values than those mentioned in import invoices and declared in bills of entry. We find that higher insured value of consignments and payment of premium to the insurance companies cannot be the justifiable ground for rejection of the transaction value, as several factors are involved for negotiation between the parties to the contract of sale, including the insurance companies. Higher value may be declared for insurance purposes for claiming higher compensation in case or damaged to the insured goods. Moreover, there is every chance that the appellants have mis-declared the value to the insurance companies. Such mis- declaration at the best may be an offence under some other law but cannot be a conclusive proof for establishing undervaluation of imported goods. The department in this case has conveniently assumed that the value declared to insurance companies was higher than the value declared to Indian Customs. We do not think that in a case, a....
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....ately on completion of the summon proceedings. Upon receipt of the SCN together with the RUD's, the appellant came to know about the content in the statements, though made by him and thus, had sent the retraction letter within the reasonable time. Thus, it cannot be said that there is inordinate delay in filing the retraction letter. Further, the letter of retraction cannot be discarded on such ground, without examining the genuineness of the transactions and for that purpose, to verify the authenticity of available documents and those retrieved during the course of investigation, which admittedly has not been done by the department. In this context, the law is well settled that merely because an assessee has, under the stress of investigation, signed a statement admitting tax liability and having also made a few payments as per the statement, it cannot lead to self- assessment or self-ascertainment. In the case of Vinod Solanki [2009 (223) E.L.T. 157 (S.C.)], the Hon'ble Supreme Court has ruled that the initial burden to prove that the confession was voluntary is upon the department and that evidence brought by confession if retracted, must be corroborated by other independent and....