2002 (12) TMI 523 - Commission - Customs

Issues Involved
1. Demand of Customs duty along with interest.
2. Confiscation of imported goods.
3. Imposition of penalty.
4. Confiscation of exported goods.
5. Fulfillment of export obligation.
6. Compliance with DEEC Scheme and related notifications.
7. Voluntary disclosure and cooperation with the Settlement Commission.

Detailed Analysis

1. Demand of Customs Duty Along with Interest
The Show Cause Notice (SCN) demanded Customs duty of Rs. 33,72,641/- along with interest under Sections 28(2) and 28AB of the Customs Act, 1962. The applicant admitted a duty liability of Rs. 8,49,906/- which was allowed to be adjusted from Rs. 25 lakhs already deposited during the investigation. The balance duty payable was Rs. 25,22,735/-, and after adjusting the remaining deposit amount, the applicant was directed to pay Rs. 8,72,641/- within 30 days from the receipt of the order. The Commission also imposed interest at 10% per annum from the date of import till the dates of deposit and payment.

2. Confiscation of Imported Goods
The SCN proposed the confiscation of Video Magnetic tapes valued at Rs. 35,91,965/- CIF and video housings valued at Rs. 6,57,414/- CIF under Section 111(o) of the Customs Act, 1962. The investigation revealed that the applicant imported these items under the DEEC Scheme but failed to comply with the scheme's conditions, leading to the proposed confiscation.

3. Imposition of Penalty
The SCN proposed penalties under Sections 112(o) and 114A of the Customs Act, 1962. However, the Commission found that the applicants had cooperated in the proceedings and made a full and true disclosure of their duty liability. Consequently, the Commission granted immunity from the imposition of fine and penalty.

4. Confiscation of Exported Goods
The SCN also proposed the confiscation of 9800 Video Cassettes valued at Rs. 10,64,923/- FOB and 12,600 video cassettes valued at Rs. 13,74,278/- under Section 113(d) and 113(i) of the Customs Act, 1962. The investigation found that the exported goods were old and used video cassettes, which violated the DEEC Scheme's conditions.

5. Fulfillment of Export Obligation
The applicant contended that they had fulfilled their export obligation. However, the Revenue's investigation and the Commission's findings indicated that the applicant had not maintained or produced records to show that the imported exempt material was transported to their factory, subjected to manufacturing, and subsequently exported. The Commission concluded that the applicant failed to provide statutory/documentary evidence to establish the fulfillment of export obligations.

6. Compliance with DEEC Scheme and Related Notifications
The applicant imported goods under the DEEC Scheme and availed duty concessions under Customs Notification 149/95-Cus. r.w. 162/95-Cus. The Commission found that the applicant's non-compliance with the provisions of these notifications resulted in a monetary benefit, thereby justifying the demand for duty and interest.

7. Voluntary Disclosure and Cooperation with the Settlement Commission
The Commission emphasized that settlement is based on voluntary disclosure and full cooperation. The applicant's willingness to abide by the Commission's decision and their cooperation during the proceedings were noted. Consequently, the Commission granted immunity from prosecution under the Customs Act, 1962, and the Indian Penal Code (45 of 1860).

Conclusion
The Commission settled the case for a duty amount of Rs. 33,72,641/-, with the applicant required to pay a balance of Rs. 8,72,641/- after adjustments. Interest was imposed at 10% per annum, and the applicant was granted immunity from fines, penalties, and prosecution. The order of settlement would be void if obtained by fraud or misrepresentation of facts.

← Previous Next →