2002 (5) TMI 767 - AT - Customs

Summary

Issues:
1. Eligibility for DEPB benefit on export consignments.
2. Confiscation of export consignments under Section 113(d) of the Customs Act, 1962.
3. Imposition of penalty under Section 114(1) of the Customs Act, 1962.

Issue 1: Eligibility for DEPB benefit on export consignments:
The case involved the export of goods declared as "Multi-Coloured Printed Books with Jacket and Cover" for claiming DEPB benefit. However, upon examination, it was revealed that the goods were not as declared and were actually printed in the USA. The exporters admitted that the books were not eligible for DEPB benefit as they were purchased from the market. The DGFT clarified that re-exporting goods to the same supplier does not qualify for DEPB benefit. The Commissioner held that DEPB benefit was not available to the exporters due to the re-export nature of the transaction and the deliberate attempt to obtain the benefit. The Commissioner ordered for the confiscation of the books under Section 113(d) of the Customs Act, 1962, and allowed redemption on payment of a fine.

Issue 2: Confiscation of export consignments under Section 113(d) of the Customs Act, 1962:
The Commissioner observed that the exporters deliberately overvalued the export consignments to earn DEPB benefit, as the overseas supplier and the buyer were the same entity. The description of the books was altered to include "multi-coloured" to qualify for the benefit. The Commissioner ordered the confiscation of the books under Section 113(d) of the Customs Act, 1962, with an option for redemption upon payment of a fine. The exporters contested the over-valuation allegation but did not dispute the liability for confiscation and redemption fine.

Issue 3: Imposition of penalty under Section 114(1) of the Customs Act, 1962:
The exporters appealed against the penalty imposed under Section 114(1) of the Customs Act, 1962. They argued that the over-valuation allegation was based on suspicion and lacked evidence. The appellants requested a reduction in the fine and the setting aside of the penalty. The Tribunal found no infirmity in the Commissioner's order, considering the DGFT's clarification and the known policy provisions. The Tribunal upheld the fine and penalty imposed by the Commissioner, dismissing the appeal.

This detailed analysis of the judgment highlights the issues of DEPB benefit eligibility, confiscation under Section 113(d), and penalty imposition under Section 114(1) in the context of the export consignments case.