2004 (12) TMI 490 - AT - Customs

Summary

Issues:
1. Under-valuation of imported Natural Graphite.
2. Confiscation of goods and imposition of penalty.
3. Evidence based on recovered invoices and telex message.
4. Allegation of intentional under-valuation.

Issue 1: Under-valuation of imported Natural Graphite
The dispute centered around the under-valuation of Natural Graphite imported by the appellants. The declared value was US $7462.70, but further investigations revealed discrepancies. Two invoices were recovered, one showing a value of US $7162.70 and the other US $21,322, with a mention of a differential amount drawn by the exporter. Statements of involved parties were recorded, and a show cause notice was issued proposing enhancement of the assessable value, leading to the impugned order by the Commissioner.

Issue 2: Confiscation of goods and imposition of penalty
The Collector of Customs enhanced the value of the imported Natural Graphite and confiscated the goods due to intentional under-valuation. The appellants were given the option to redeem the goods on payment of a fine and a penalty of Rs. 75,000 was imposed on the 2nd appellant. The penalty and confiscation were based on the alleged under-valuation and discrepancies in the invoices.

Issue 3: Evidence based on recovered invoices and telex message
The Revenue presented evidence in the form of two invoices for the same importation, with a significant difference in values. The second invoice indicated a differential amount drawn from the importer's deposit. The Commissioner found that these invoices, along with a telex message intercepted from the indenter's office, provided sufficient evidence of under-valuation. The appellants argued that the evidence was insufficient and did not directly link them to the under-valuation.

Issue 4: Allegation of intentional under-valuation
The appellants contended that the Revenue's case was solely based on the recovery of invoices and a telex message from the indenter's premises, without direct evidence linking them to intentional under-valuation. However, the Tribunal disagreed, stating that the recovered invoices clearly showed discrepancies in values and the telex message hinted at attempts to conceal information. The Tribunal upheld the Commissioner's findings, concluding that there was substantial evidence to support the allegation of intentional under-valuation.

In conclusion, the Tribunal rejected the appeals filed by the appellants, affirming the Commissioner's decision based on the evidence presented, including recovered invoices and the telex message. The judgment emphasized the importance of proving under-valuation beyond doubt and upheld the penalty and confiscation based on the established discrepancies.