2005 (4) TMI 457 - Commission - Customs

Summary

Issues: Settlement application under Section 127B of the Customs Act, 1962. Duty amount confusion. Market Enquiry discrepancies. Immunities granted under Section 127H(1) of the Act.

In the judgment by the Settlement Commission for Customs and Central Excise, an application for settlement was filed by M/s. Track One and Shri Gurvinder Singh Kochhar under Section 127B of the Customs Act, 1962. The case involved a consignment imported by the applicant, which was found to have gross misdeclaration in description, country of origin, and valuation. A Show Cause Notice was issued by the Commissioner of Customs, demanding differential customs duties and invoking penal provisions. The duty amount confusion arose due to discrepancies in the duty demanded, revised duty amounts based on market enquiry, and varying calculations by different officers. The applicant argued for a revised duty liability based on the latest Market Enquiry report, highlighting the depreciation of goods' value over time. The Revenue, represented by the Superintendent of Customs, justified the duty amount based on market value at the time of seizure, but admitted lack of full disclosure of market enquiry details to the applicant.

The Settlement Commission observed multiple duty amounts proposed by different officers and parties involved. It found the applicant's claim for settlement of additional duty liability based on the Enquiry Officer's calculation to be reasonable, amounting to Rs. 4,84,472/- excluding the amount already paid. The Commission deemed the figure of Rs. 5,02,515/- arrived at by the Commissioner (Investigation) as unreasonable, considering the highest price without adequate justification. The Commission also criticized the Revenue's unsustainable duty calculations lacking documentary evidence and not supported by the Show Cause Notice. The Commission emphasized that Kacha receipt/quotations cannot be the basis for determining the assessable value, highlighting the importance of a proper market enquiry.

The Settlement Commission acknowledged the applicant's full disclosure of duty liability and cooperation during the proceedings. Consequently, the Commission settled the case under Section 127C(7) of the Act. The settlement terms included the settlement of additional customs duty at Rs. 4,35,311/-, with a requirement for the applicant to deposit the balance amount within 30 days. Immunities from fine, penalty, and prosecution were granted to the applicant based on their cooperative conduct. These immunities were also extended to the co-applicant. The Commission specified that the order of settlement would be void if obtained through fraud or misinterpretation of facts, ensuring accountability. All concerned parties were duly informed of the settlement terms and conditions.