TaxTMI 
TaxTMI 
2026 (8) TMI 937
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....t of "Decorative & Design Sheet Article of Wall Panel Grade J-3" and "Decorative Design Stainless Steel Profile GradeJ-3"at ICD Panchi Gujara, Gannaur, Sonepat and filed B/E No. 5128433 dated 01.10.2019. The said consignment was seized by the officers of Preventive Commissionerate, Delhi. Later, the said case was transferred to DRI(DZU). 2.1. Apart from the above consignment, the Appellant also imported another consignment of Cold Rolled Coated Stainless Steel Sheets of J-3 Grade having different sizes and filed B/E No. 6101337 dated 16.12.2019 for clearance of the same at ICD, Dadri. The said consignment was initially detained and subsequently seized by the DRI (DZU) on the ground that the goods covered under the aforesaid B/E was mis-classified. 2.2. After seizure, proceedings were initiated against the Appellant. During investigation, the DRI officers conducted search of the residential premises of the Appellant and recorded the statement of Shri Shreyance Jain, the proprietor of the Appellant on the day of search dated 17.12.2019. His statements were also recorded on various dates, 24.10.2019 & 25.10.2019, 04.03.2020, 05.03.2020, 06.03.2020, 01.02.2021 and 06.09.2021. The....
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....sioner of Customs, Greater Noida, Ghaziabad, has passed the following order:- (i) I reject the classification under tariff item 73269060 of the CTA, for the goods entered and declared in the bills of entry detailed in duty Annexures to the SCN dated 29.11.2022, and order re-determination under appropriate tariff item of the CTA, as per value mentioned in said Annexures to the SCN. with consequential duty liability; (ii) I reject the value of the goods declared in the bills of entry, detailed in the Annexure-MB-1/MB-2/MB-3/MB-4 to the SCN dated 29.11.2022, in terms of the Rule 12 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007 and order re-determination thereof at Rs 27,23,88,617/- (Rupees Twenty Seven Crore Twenty Three Lac Eighty Eight Thousand Six Hundred and Seventeen only), as detailed in Annexure-MB-1/MB-2/MB3/MB-4, to the SCN dated 29.11.2022, in terms of the Section 14 of the Customs Act, 1962 read with Rule 3 & 9 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007, with consequential duty liability. I also reject the value of goods declared in the Bill of Entry No 6101337 dated 16.12.2019 in terms....
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....under Section 112 (a)/112(b) of the Customs Act, 1962 in view of the penalty imposed under Section 114A of the Customs Act, 1962. (xi) I impose penalty of Rs 10,00,00,000/- (Rupees Ten Crore only) upon the Noticee i.e. M/s M.B. International (through its Proprietor, Shreyance Jain) under Section 114AA of the Customs, Act, 1962, (xii) I order initiation of prosecution proceedings against the Noticee i.e. M/s M.B. International (through its Proprietor, Shreyance Jain) under the provisions of Section 135 of the Customs, Act, 1962. 4.2. Aggrieved against the demand of differential customs duty along with interest and imposition of various penalties, the Appellant has filed this appeal. 5. At the outset the Appellant submits that in the initial Show Cause Notice there were no proposals regarding rejection of the declared value on the ground of mis-declaration of value, denial of benefit of Notification No. 46/2011-Cus dated 01.06.2011 and the quantum of duty demanded was Rs. 2,86,190/- whereas in the Supplementary Show Cause Notice fresh proposals were made to reject the declared value and denial of benefit of Notification No. 46/2011-Cus and duty demand was enha....
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....ssed in clear violation of the principles of natural justice. Moreover, the issuance of such corrigenda immediately before issue of Order-in-Original, is bad in law and the corrigenda are non-est in the eyes of law inasmuch as no sufficient opportunity has been provided to the Appellant. 5.2 The Appellant further submits that demand of Customs duty against finally assessed BE's cannot be issued by the department without challenging the assessment order contained in such BE's as held by the Hon'ble Supreme Court in the following cases:- i. Priya Blue Industries Ltd. vs. C.C (Prev) 2004(172) ELT 145 (SC), ii. Collector vs. Flock (India) Pvt. Ltd. 2000 (120) ELT 285 (SC) iii ITC Ltd. vs. C.С.Е - 2019 (368) ELT 216 (SC) Wherein the Hon'ble Supreme Court while upholding the judgments in the case of Priya Blue Industries Ltd. and Flock (India) Pvt. Ltd. has held that assessment in a B/E includes self-assessment and that has to be challenged in appeal. 5.3 Then Appellant submits that one of the allegations against them is that the COOs were not genuine. The Appellant submits that the said allegation is not sustainable as it i....
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....nd to be not genuine, the Certificate of Origin ("COO") bearing No. KL2019-AI-21-018819, purportedly issued by M/s Hard Metal Trade Sdn. Bhd., submitted by the Appellant was found to be fake. On the basis of this solitary allegation, the DRI proceeded to presume that all the COOs issued by the other suppliers, submitted by the Appellant were also fake. In this regard, the Appellant submitted that the goods covered under B/E No. 6101337 dated 16.12.2019 were seized by the officers of ICD, Dadri vide Panchnama dated 14.01.2020 (RUD-2 placed at Pg. No. 295 - Paper-Book-2 of the Appeal). It may be seen that at the time of seizure the officers also seized B/E No. 6101337 dated 16.12.2019 along with COO bearing No. KL-2019-AI-31018231 dated 29.11.2019, (which is part of RUD-2). It may be appreciated that the DRI has deliberately chose to mention incorrect number of COO although the correct COO was available with them at the time of issuing the Show Cause Notice. COO No. KL-2019-AI-31-018231 dated 29.11.2019 is not mentioned in the list of 87 unauthentic COOs enlisted in the email received by the department from MITI. Thus there is, in fact, none of the COOs submitted by the Appellant in ....
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....end use of SS Sheets imported from Malaysia and China were the same. The Appellant submits that no representative samples of the seized consignments were drawn at the time of examination or seizure of the goods, for testing/chemical analysis by any recognized laboratory or technical agency. In the absence of any test report or expert opinion, the finding that the goods were classifiable under CTH 7219/7220 is based merely on assumptions and presumptions. Accordingly, the Appellant submits that reclassification of the goods under the CTH 72199090 is legally not sustainable. 6.1. The Appellant submits that in order to change the classification of the goods imported, the burden is on the Revenue to adduce proper evidence. The Hon'ble Supreme Court in the case of H.P.L. Chemicals Ltd. v. CCE, Chandigarh, 2006 (197) E.L.T. 324 (S.C.) held that when the Department seeks a different classification, it must produce proper evidence; mere assertion is not sufficient. The same principle was reiterated in Hindustan Ferodo Ltd. v. Collector of Central Excise, 1997 (89) E.L.T. 16 (S.C.), where the Supreme Court held that if Revenue fails to lead evidence to establish its proposed classificati....
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.... in the impugned order along with interest penalty are legally sustainable. 9. Heard both the sides and perused the appeal documents. 10. At the outset, we find that the Appellant has raised some preliminary objections regarding the Supplementary Show Cause Notice issued in this case. It is the submission of the Appellant that in the initial Show Cause Notice, there were no proposals regarding rejection of the declared value on the ground of misdeclaration of value, denial of benefit of Notification No. 46/2011-Cus dated 01.06.2011 and the quantum of duty demanded was Rs. 2,86,190/- whereas in the Supplementary Show Cause Notice fresh proposals were made to reject the declared value and denial of benefit of Notification No. 46/2011Cus and duty demand was enhanced to Rs. 10,22,048/-. We find that Notification No. 42/2019-Cus (NT) dated 18.06.2019, under Customs (Supplementary Notice) Regulations, 2019 permits issue of Supplementary Show Cause Notices. Regulations 4(1)(c) of the Customs (Supplementary Notice) Regulations, 2019, allows invocation of additional sections. Regulations 4(1)(a) and 4(1)(d) also permits issue of supplementary show cause notice on the ground of additio....
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....stoms in respect of consignments said to have been imported from Malaysia, are not authentic; b) AS the COO Certificates are unauthentic, the Appellant would not be eligible for the benefit of exemption as provided under the Notification No.46/2011-Cus dated 01.06.2011 c) Goods imported by the Appellant were wrongly classified under the CTH 7326, whereas the correct classification of the impugned goods would be under the CTH 7219 of the Customs Tariff Act, 1975' d) Undervaluation of goods imported by the Appellant. 12. We find that the Appellant has imported the goods namely CRSC/CRSS of Chinese origin directly from China as well as routed through Malaysia. The Appellant had declared the classification of the goods under the Tariff Item No.73269060 of the Customs Tariff Act and claimed the benefit of Notification No.46/2011-Cus. dated 01.06.2011, as the goods were of Chinese origin imported through Malaysia. The department alleged that the Appellant was not eligible for the benefit of the said Notification dated 01.06.2011. Accordingly, the Notice proposed to reject the Country of Origin Certificates (COOs) submitted by the Appellant at the time of cle....
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....OO No. KL-2019-AI-31-018231 dated 29.11.2019, which is the correct COO number is not mentioned in the list of 87 unauthentic COOs enlisted in the email received by the department from MITI. Thus there is, in fact, none of the COOs submitted by the Appellant in respect of the consignments imported from Malaysia, is appearing as unauthentic. Also there is no such evidence brought on record by the investigation. Upon scrutiny of the relevant documents, we find that there is an error in the COO number. The correct COO number submitted along with the B/E No. 6101337 dated 16.12.2019 was KL-2019-AI-31018231 dated 29.11.2019, In support of this claim, the Appellant submitted copy of the said COO, along with the corresponding Bill of Entry, Panchnama, commercial invoice, and marine insurance document. On perusal of the document submitted by the Appellant, we find that there is an error in mentioning the COO number with respect to the goods imported by the Appellant vide B/E No. 6101337 dated 16.12.2019. A perusal of the said list containing 87 CCsOs which are not genuine and the supporting documents submitted by the Appellant demonstrate that none of the COOs submitted by the Appellant was....
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....s eligible for the benefit of exemption as provided under the Notification No.46/2011-Cus dated 01.06.2011, in respect of all the COOs submitted by them. 12.7. So far as all the COOs submitted by the Appellant is concerned, we find that as on the date of import, the Certificate of Origin meets the requirement, with the Overseas Exporter giving the declaration and the same being authenticated by the Authorized Officials of the Malaysian Government. Their Signatures have been verified by the Customs officials and only after this, the consignments have been allowed to be imported under concessional rate of duty, by the Proper officer. Thus, we find that the requirements under the Notification have been met on the date of import. The same cannot be negated by a subsequent communication received from Malaysia after more than 2 years, without coming out with the details of the contravention and action being taken by them. We find that none of certificates was cancelled or revoked by the Govt of Malaysia. In such a case, no claim can be made on an importer who relied upon the certificates issued by the Authorized Officials of the exporting country. There is nothing to indicate that the....
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....f Entry by presenting 16 country of origin certificates. Consequently, we hold that the impugned order passed by rejecting the benefit of the said notification is not sustainable." 12.9. In the present case, after going through the Certificates of Origin reproduce above, it is observed that as the Declaration is duly signed by the exporter and the Certificate of Origin has been duly issued by the Designated authority, whose signature has been verified by the Indian Customs Officials. Therefore, prima facie, that all the due diligence verification, including verification of the documents supplied by the exporter, pre-exportation verification etc., have been duly carried out by the Designated authority at Thailand. There is no scope to doubt as to whether the due verification has been done or not, so long as the authenticity of the Certificate of Origin and its Authorized Signatories are found to be is not found to be fabricated. We have perused the communication received from MITI, which states that 87 of the 143 COOs are unauthenticated and hence the consignments do not qualify for the Preferential Treatment. In this regard, we observe it is to be taken that the Importers and Go....
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....Sheet Article of Wall Panel Grade J-3" and "Decorative Design Stainless Steel Profile Grade J-3" imported at the port of ICD, Sonepat and "Cold Rolled Coated Stainless Steel Sheets J3" imported at ICD, Dadri were classified by the Appellant under CTH 7326. It is an admitted fact that the classification of the goods depends upon their actual form, composition, width, thickness, degree of processing and whether the goods had retained the character of flat-rolled stainless steel products or had assumed the character of distinct articles. In the present case, we find that the proper officer has examined the goods and accepted the classification of the goods as declared in the Bills of Entry. No objection was raised. Subsequently, if the department wants to re-classify the goods imported and cleared, then there must be specific reasons supported by evidence. In the present case, we find that no representative samples of the seized consignments were drawn at the time of examination or seizure of the goods for testing/chemical analysis by any recognized laboratory or technical agency. In the absence of any test report or expert opinion, the finding that the goods were classifiable under C....
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....ot sufficient. The same principle was reiterated in Hindustan Ferodo Ltd. v. Collector of Central Excise, 1997 (89) E.L.T. 16 (S.C.), where the Supreme Court held that if Revenue fails to lead evidence to establish its proposed classification, the assessee's appeal should succeed even if the assessee's own evidence is rejected. 13.5. We find that the confirmation of demand of CVD on the goods imported by the Appellant under Notification No. 01/2017Customs (CVD) dated 07.09.2017 by the learned Respondent is based on the ground that as the COO Certificates presented by the Appellant were non-authentic and that the goods are classifiable under the CTH 7218 / 7219. In this regard, we observe that the COO Certificates produced by the Appellant before the Customs Officers at the time of assessment are genuine / authentic (except the one COO mentioned in the list provided by the MITI) and that the goods imported by the Appellant are correctly classifiable under the CTH 7326 as stated in the preceding paragraphs. Therefore, we hold that the findings of the learned Respondent with regard to levy of CVD under Notification No. 1/2017-Cus holding the goods actually of Chinese origin....
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....ms Valuation Rules, 2007 for the purpose of enhancement of value. There is no evidence available on record that the Appellant has paid any amount over an above the declared invoice prices. Further, we find that there is no documentary evidence available on record to show that the Appellant has paid any amount over and above the declared value. In that circumstances the rejection of the transaction value declared by the Appellant is legally not sustainable. We find that this view has been held by Hon'ble Supreme Court in the case of Eicher Tractor Ltd. V/s Commissioner of Customs, Mumbai reported at 2000 (122) E.L.T. 321 (S.C.) and in the case of Commissioner of Customs, Calcutta V/s South India Television P. Ltd. reported at 2007 (7) TMI 9 - (Supreme Court). Thus, by relying on the decisions cited supra, we hold that the value declared by the Appellant cannot be rejected. Thus, we hold that the enhanced value re-determined by the Revenue is not sustainable and hence, we set aside the same. 15. Regarding the penalties imposed on the Appellant, we find that the penalties have been imposed on the allegation of misdeclaration and undervaluation of the impugned goods by the Appellant....