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2016 (11) TMI 1200 - AT - CustomsValuation - rejection of transaction value of the import of Lux brand soaps declared by the appellant - Held that - Ld. adjudicating authority at page 18 and 19 of the impugned order, has brought out the reason for disturbance of the declared value and applied Rule 4 (1) of Customs Valuation Rules, 1998, stating reason therefor. There is no evidence led by appellant importer to controvert the action of the Authority and to rule out application of the said Rule. In absence of any material to suggest that the said Rule is not invokable, it appears that the department acted within its jurisdiction. The imported goods were found to be subject to MRP and valuation made by Department was rational considering minute details of sale price. Therefore, there is no necessity to intervene to the manner of valuation done by the department. Once misdeclaration of the value of import is established, confiscation was warranted. That has been done rightly. The levy of Customs duty on the determined value of ₹ 23,23,159/- has been levied. That is justified and does not require any interference Imposition of redemption fine - Held that - there appears no basis provided by the authority nor the decision of that authority reasoned even though the authority looked into the weights and measures of law and also the character of the goods subject to MRP. Certain calculations were made by the authority at page-20 of the impugned as to the retail price of the offending goods. Looking to such calculation, a reasonable profit of 20% appears to be the gain made by the appellant importer. Therefore, redemption fine is reduced to 20% of the value of ₹ 23,23,159/- determined by Adjudicating Authority. Imposition of penalty u/s 112 (a) - Held that - The penalty imposed is ₹ 1,00,000/-. The evidence recorded by the authority does demonstrate that he was the power of attorney holder of his wife to make import. He was instrumental to cause evasion of duty misdeclaring the value for which he does not deserve any reduction in penalty - appeal is dismissed. Appeal disposed off - decided against appellant.
Issues:
1. Rejection of transaction value of imported goods. 2. Imposition of redemption fine and penalties under Customs Act, 1962. 3. Misdeclaration of import value. 4. Confiscation of goods and penalties imposed on the importer and an individual. Analysis: 1. The appellant contested the rejection of the transaction value of imported "Lux" brand soaps, leading to the imposition of a redemption fine and penalties under the Customs Act, 1962. The appellant argued that there was no valid basis for enhancing the declared value, making the confiscation and penalties unwarranted under Section 125 of the Act. The appellant further contended that the penalties imposed were unjustified under Sections 114A and 112(a) of the Customs Act, 1962. 2. The Revenue, on the other hand, asserted that there was a deliberate misdeclaration of the import value, supported by the appellant's past import data. The department argued that the misdeclaration warranted no leniency due to the deliberate evasion. The adjudicating authority justified the disturbance of the declared value by applying Rule 4(1) of the Customs Valuation Rules, 1998, and found the department's valuation rational based on detailed scrutiny of the sale price, leading to the confiscation of goods and levy of customs duty on the determined value. 3. The tribunal examined the authority's reasoning for imposing a redemption fine and found the lack of a clear basis for the fine amount. The tribunal reduced the redemption fine to 20% of the determined value, guided by a Supreme Court judgment, and upheld the penalty imposed under Section 114A on the importer. The tribunal partially allowed the appeal of the importer, M/s. Safi & Co., in this regard. 4. Regarding the penalty imposed on an individual, Shri Mohammed Sahabudeen, under Section 112(a), the tribunal upheld the penalty amount of ?1,00,000. The tribunal noted that the evidence demonstrated his involvement in the misdeclaration of import value, as he was the power of attorney holder instrumental in causing duty evasion. Despite considering his role, the tribunal found no grounds to reduce the penalty, leading to the dismissal of his appeal. In conclusion, the tribunal disposed of both appeals, confirming the penalty on the importer under Section 114A while dismissing the appeal of the individual regarding the penalty under Section 112(a) of the Customs Act, 1962.
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