TaxTMI 
TaxTMI 
2026 (3) TMI 112
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....ed herein below: 2.2 The appellant had filed Bill of Entry No. 7379198 dated 16.08.2023 for clearance of assorted goods of twenty different consumer items, which were imported from China. The imported goods were declared with the description as provided in the supplier's invoice/packing list No.232192-5 dated 25.07.2023 and these were classified under respective Customs Tariff Item (CTI) of the First Schedule to the Customs Tariff Act, 1975 with total declared assessable value of Rs.14,08,260/-. On the basis of specific intelligence that a consignment of mixed items is imported with alleged mis-declaration, the above imported consignment was put on hold by the Special Intelligence and Investigation Branch of New Custom House, Mumbai (SIIB) and the said goods were subjected to 100% examination by drawing Pachamama dated 22.08.2023. 2.3 As a result of such examination by SIIB officers, it was found that out of the twenty items, in respect of three items there were certain discrepancies as mentioned below: (i) as against the declared item of 'Kitchen knife set (05 pieces)', on physical examination it was found to be 'Kitchen knife with chopping board' (ii) as a....
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....n the grounds of mis-declaration under Section 111(d) and 111(m) ibid and allowed it to be released on payment of redemption fine of Rs.90,000/- under Section 125 ibid; besides, he also imposed penalty of Rs.9,20,982/- on the appellant importer under Section 114A; penalty of Rs,25,000/-under Section 112(a) ibid and Rs.90,000/- under Section 114AA ibid. Being aggrieved with the order of the original authority, the appellant had preferred an appeal before the Commissioner (Appeals), which was disposed of by him by confirming the order of the original authority and by dismissing the appeal filed by the appellant vide Order-in-Appeal dated 27.03.2024. Feeling aggrieved with the impugned order dated 27.03.2024, the appellant had preferred the present appeal before the Tribunal. 3.1 Learned Advocate appearing for the appellant submitted that the learned Commissioner (Appeals) had failed to consider the fact that the appellant-importer had in his statement dated 08.09.2023 had specifically stated that the prices mentioned in the Bill of Entry is the actual price of the goods imported by them, and prices ascertained during the market survey is after the profit margin added at wholesaler....
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.... per Rule 7 of the Customs Valuation (Determination of Valuation of Imported Goods) Rules, 2007 by relying on the comparable price of sale made at the greatest aggregate quantity to persons not related and at same or first commercial level after importation. Therefore, he pleaded that such redetermination of value by the original authority, which was upheld by the first appellate authority has no force of law. As regards classification of walking stick with torch, the appellant had submitted that in terms of the features of the product and on the basis of essential character of the goods, these are classifiable under CTI 6602 0000 and not under 9405 4900, in terms of Rule 3(a)(b) of the General Rules for interpretation of customs tariff. Further, by citing the details of BIS standard IS:10322(Part-I) 1982 and HSN explanatory notes providing that the features built in for aesthetics, rich or luxury look or to enhance the utility of walking sticks does not take away from classifying it under CTH 6602, the appellant claimed that the classification adopted by them is correct and the revised classification adopted by the department has no legal basis. 3.4 In support their stand, he h....
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....o support the allegation of mis-declaration of description of goods and its value as declared by the appellant, in order to reject the transaction value for all goods and the classification in respect of walking stick with torch, and for imposition of fine and penalty on them. 6.2 Learned adjudicating authority in the impugned order had given his findings for re-determination of assessable value and for revision of classification of walking stick with torch, and had come to the conclusion that the appellants are liable for imposition of penalty, redemption fine on imported goods for violation of various legal provisions, as follows: "DISCUSSION AND FINDINGS 19. I have carefully gone through the facts of the case contained in Investigation Report with Annexures of SIIB (1), NCH, Mumbai-l, records available and submissions made by the importer. The importer voluntarily requested for waiver of Show Cause Notice and Personal Hearing and has also accepted the re-determined value. The proposed reason for confiscation and penal action contained in Investigation Report of SIIB has been explained orally to the Importer as stipulated in provision to Section 124 of Customs Act.....
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....ance of labelling conditions have to be ensured before the import consignment of such commodities are cleared by Customs for home consumption." 27. It is seen from ICES EDI system that the consignment has not been given OOC and thus not cleared for home consumption from Customs Custody. Hence, they can comply with RE-44-condition before clearance of the goods from Customs Custody. However, if they fall to do so the goods will be liable for absolute confiscation under Section 111(d) of Customs Act, 1962. 28. The imported goods do not correspond to the transaction documents i.e., invoice and packing list. The importer has accepted in statement under Section 108 of Customs Act, 1962, the mis-declaration of value. Hence the declared value is not the true transaction value and is liable to be rejected in terms of Rule 12 or Customs Valuation Rules 2007, read with Section 14(1) of the Customs Act 1962 and therefore the value of the imported goods needs to be re-determined in accordance with Customs Valuation Rules 2007. 29. Rule 3(4) of CVR, 2007 provides that the value of imported goods is required to be re-determined by proceeding sequentially from miles 4 to....
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....nd rule made in this regard. 31. The importer is required to declare the correct quantity, value, classification, description, notification number, if any, on the imported goods as per the provisions of section 46 of the Customs Act. 1962 and the Bill of Entry (Electronic Declaration) Regulation, 2011. The importer is squarely responsible for filing of all details and declaration and related documents and confirming these are true, correct, and complete. I find that the importer has failed to declare the correct quantity, description and value in respect of the imported goods thereby evading Customs duty of Rs. 9,20,982/- (Rupees Nine Lakhs Twenty Thousand Nine Hundred and Eighty Two only) for Non-prohibited goods. The said short-paid/ differential duty is liable to be demanded and recovered from the importer under Section 28(1) of Customs Act, 1962, along with applicable interest thereon in terms of provisions of Section 28AA of the Customs Act, 1962. I hold that the imported goods of the Subject Bill of Entry with re-determined value of Rs. 39,30,186/- (Rupees Thirty Nine Lakhs Thirty Thousand One Hundred & Eighty-Six only) are liable for confiscation under Section 111(d....
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....onfiscation under Section 111(d) and 111(m) of the Customs Act, 1962. In this regard, I found that items No -2 declared as Walking Stick with Torch (1600 Pcs) are mis-classified under CTH 66020000 actually it should be classifiable under CTH-94054900 which are contravention of BIS provisions, become prohibited for import and are liable for confiscation under section 111 (d) and 111 (m) of Customs Act, 1962 and thus I confiscate the same. Further, for failure on part of importer which led to non levy of applicable duty and for use of false and incorrect material, importer is liable for penalty under section 114 (A) as well as Section 114 (AA) of Customs Act, 1962. As I intent to impose penalty under section 114 A, hence no penalty is liable to under section 112 (A) as per provisions of 114 A of Customs Act, 1962. 34. In view of the above, I pass the following Order: ORDER 34.1. I reject the declared assessable value of Rs. 14,08,260/- in respect of Bill of Entry No. 7379198 dated 16.08.2023 under Rule 12 of the CVR, 2007 and re-determine the same as Rs. 39,30,186/- under section 14(1) of Customs Act 1962. read with Rule 7 of the CVR, 2007 for prohibited and non ....
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....om the warehouse as per the rule & regulations prescribed in notification no. 44 (RE- 2000)/19972002 dated 24.11 2000 of DGFT and Legal Meteorology (Pre-Packaged Commodities) Rule, 2011, failing which the same are to be confiscated absolutely u/s 111(d) of Customs Act, 1962; 34.9. This order is issued without prejudice to any other action that may be taken against the Noticee or persons or imported goods under the provisions of the Customs Act 1962, or any other law for the time being in force in India." Further, the learned Commissioner (Appeals) in the impugned order dated 27.03.2024 has upheld the order of the original authority, on the following grounds: "5.....(iv) Market Survey was conducted in the presence of the proprietor of M/s Jilani Traders and he put dated signature on the invoice raised during market enquiry. It is evident from Para 17.1 of the impugned order that the Appellant vide letter dated 20.10.2023 accepted the valuation of the goods imported by them arrived on the basis of market survey conducted in presence of the proprietor of M/s Jilani Traders under Section 14 of the Customs Act, 1962 read with CVR. 2007. ...... Further, I find the OA....
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....d the Show Cause Notice as well as the Personal hearing clearly indicates that they had accepted all the discrepancies revealed during the investigation and subsequent valuation done by the department without any protest and now contending all the charges which appears to be afterthought to shield themselves from the confiscation of the goods and imposed penalty under customs law. Hence, I am of considered view that once importer get clearance of non-prohibited goods after agreeing with the mis-declaration with respect to classification and value etc., and at later stage creating dispute is not acceptable particularly when they had given consent letter and requested for waiver of Show Cause Notice and Personal Hearing too. Under these circumstances, their contentions as well as relied upon judgments diminish their relevance as facts and circumstances are different, hence cited judgments are of no help to them. Considering these facts and relying on the various judicial pronouncements as discussed above enhanced value, classification once settled and duty having been paid accordingly without protest, importer cannot challenge the same subsequently. 10. In view of t....
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.... Pcs 40 45 50 45.00 19. Anti Slip Mat Pcs 35 36 37 36.00 20. Foot Massager Pcs 95 90 100 95.00 21. Party Halloween Gift Item (paper plate) Pcs 45 50 55 50.00 22. Party Halloween Gift Item (paper cup) Pcs 20 22 24 22.00 23. Party Halloween Gift Item (ghost faced props type 1) Pcs 200 210 220 210.00 24. Party Halloween Gift ghost faced props type 2) Pcs 225 230 240 231.67 25. Party Halloween Gift Item (horns wig) Pcs 60 70 80 70.00 26. Party Halloween Gift Item (ghost eye balls) Pcs 33 34 35 34.00 27. Party Halloween Gift Item (Ghost lantern) Pcs 60 70 65 65.00 28. Party Halloween Gift Item (finger nail cover) Pcs 32 33 34 33.00 29. Party Halloween Gift Item (Vampire neck costume) Pcs 170 180 190 180.00 30. Party Halloween Gift Item (Halloween witch set) Pcs 155 160 170 161.67 31. Party Halloween Gift Item (Halloween hands) Pcs 410 405 415 410.00 32. Party Halloween Gift Item (Halloween fingers se....
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....r Note to Rule 7 of the 'Interpretative Notes' specified in the Schedule to CVR vide Rule 13 ibid, have not at all been considered in arriving such value re-determined by the department either in the investigation report or in the order of the original adjudicating authority. Therefore, for these reasons alone the value determined under Rule 7 of CVR in the original order is liable to set aside inasmuch as it is not in conformity with the legal provisions of Rule 7 ibid, which mandates that the goods being appraised are to be valued on the basis of prices sold in subsequent sales of identical or similar goods in India, having first commercial level after importation/same commercial level and at the greatest aggregate quantity. 7.2 From the careful perusal of the orders passed by the authorities below, viz., the order of the original authority, which was upheld by the learned Commissioner (Appeals) in the impugned order, as detailed at paragraph 6.2 above, it clearly transpires that the requirements of Rule 3 and following sequentially Rule 4 to Rule 9 of CVR, 2007 have not been followed, as it is stated at paragraphs 11.6 and 11.7 that the National Import Data Base (NIDB) data d....
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....Pointer Pen (Type 2) 14000 7. LED Diodes 546 Pkt LED Diodes (1000pcs/pkt) 546 Pkt 8. Glue 300G 2160 Glue 300G (Waterproofing) 2160 9. Umbrella 8480 Umbrella 8480 10. Disposable Eyebrow Razor 33120 Disposable Eyebrow Razor 33120 11. Kitchen Tape 4008 Kitchen Tape 4000 12. Potable Air Pump 1125 Potable Air Pump 1125 13. 46 Pcs Socket Set 960 46 Pcs Socket Set 960 14. Alarm Clock 4008 Alarm Clock 4000 15. Lint Remover 2400 Lint Remover 2400 16. Mini Vacuum Cleaner 4320 Mini Vacuum Cleaner 4320 17. Kitchen Cleaner 2004 Kitchen Cleaner 2004 18. Anti Slip Mat 4008 Anti Slip Mat 4000 19. Foot Massager 2500 Foot Massager 2500 20. Party Halloween Gift Item 5724 Party Halloween Gift Item (paper plate) 1200 Party Halloween Gift Item (paper cup) 1440 Party Halloween Gift Item (ghost faced props type 1) 100 Party Halloween Gift Item (ghost faced props type 2) 100 Party Halloween Gift Item (horns wig) 100 Party Halloween Gift Item (ghost eye balls) 480 P....
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....t by duly following the General Rules for Interpretation (GIR) and the General Explanatory notes (GEN) contained therein. The First Schedule to the said Act of 1975 specifies the various categories of imported goods in a systematic and well-considered manner, in accordance with an international scheme of classification of internationally traded goods, i.e., 'Harmonized Commodity Description and Coding System' (HS). Accordingly, goods are to be classified taking into consideration the scope of headings / sub-headings, related Section Notes, Chapter Notes and the General Rules for the Interpretation (GIR) of the First Schedule to the Customs Tariff Act, 1975. Rule 1 of the GIR provides that the classification of goods shall be determined according to the terms of the headings of the tariff and any relative Section notes or Chapter notes and thus, gives precedence to this while classifying a product. Rules 2 to 6 provide the general guidelines for classification of goods under the appropriate subheading. In the event of the goods cannot be classified solely on the basis of GIR 1, and if the headings and legal notes do not otherwise require, the remaining Rules 2 to 6 may then be appli....
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....lsewhere specified or included; illuminated signs, illuminated name-plates and the like; prefabricated buildings Notes : 1. This Chapter does not cover: xxx Chapter Heading Description of goods (1) (2) 9405 Luminaires and lighting fittings including searchlights and spotlights and parts thereof, not elsewhere specified or included; illuminated sings, illuminated name-plates and the like, having a permanently fixed light source, and parts thereof not elsewhere specified or included - Chandeliers and other electric ceiling or wall lighting fittings, excluding those of a kind used for lighting public open spaces or through fares: 9405 1100 -- Designed for use solely with light-emitting diode (LED) light sources xxx xxx - Other electric luminaires and lighting fittings: 9405 4100 -- Photovoltaic, designed for use solely with light-emitting diode (LED) light sources 9405 4200 -- Other, designed for use solely with light-emitting diode (LED) light sources 9405 4900 -- Other 8.5 It could be seen that by applying the GIR 1, the position is made clear that Chapter Heading 6602 covers with....
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....irement under IS:10322(Part-I) - 1982 that is applicable for luminaires for use with tungsten filament, tubular fluorescent and other discharge lamps on supply voltage not exceeding 1000V. Furthermore, we also find that BIS standard for walking sticks covered under IS:5150-1969 (as amended) cover those walking sticks manufactured from Malabar cane, wood or aluminium tubes subjected to certain processes specified therein and not to the type of walking sticks referred in the present case. Since, the impugned order or the order of original authority, have not dealt with these aspects of BIS requirements under this category, we do not find it necessary to address the same here. Thus, the requirement of BIS certificate for walking sticks classified under CTI 9405 4900 as electric luminaires does not stand the legal scrutiny. 8.9 Therefore, we are of the considered view that the appellant importer had correctly classified the imported goods and there is no mis-declaration of the walking sticks with torch for attracting non-compliance requirements under BIS certification and in respect of other goods for mis-declaration of value, description under Section 111(d) and 111(m) of the Act o....