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Issues: Mis-declaration of Maximum Retail Price (MRP) on imported goods leading to duty evasion and subsequent confiscation and penalty.
Analysis: 1. The appellants imported rechargeable emergency lights from Hong Kong and declared the MRP at Rs. 600/- per piece for some consignments and Rs. 790/- per piece for others. However, upon investigation, it was discovered that the MRP was later changed to Rs. 825/- per piece by sticking labels on the goods. 2. Subsequently, proceedings were initiated against the importers for duty recovery due to mis-declaration of MRP. The impugned order demanded duty of Rs. 4,94,020/-, confiscated some goods, imposed a fine of Rs. 10 lakhs, and also levied penalties under the Customs Act, 1962. 3. The Customs Tariff Act provides for the levy of Additional Customs Duty on imported goods based on the excise duty leviable on a similar article if manufactured in India. The assessable value is determined based on the retail sale price declared on the package, as required by law, with provisions for abatement. 4. The appellants attempted to justify the enhanced MRP by claiming that the subsequent buyer raised the price. However, it was noted that both companies were related entities, and tampering with the MRP, even by a wholesale buyer, constitutes a violation as the MRP reflects the final sale price for duty calculation purposes. 5. Referring to a similar case, the Tribunal upheld the differential duty based on the enhanced MRP, along with confiscation of goods and imposition of penalties. Consequently, the differential duty of Rs. 4,94,020/- was upheld, but the redemption fine and penalties were reduced considering the circumstances. 6. The Tribunal modified the quantum of redemption fine and penalty, reducing them to Rs. 5 lakhs and Rs. 1 lakh respectively for different quantities of confiscated goods. The appeal was rejected except for the modifications in the fines and penalties. This judgment highlights the significance of accurate declaration of MRP on imported goods to prevent duty evasion and underscores the consequences of mis-declaration, including confiscation and penalties. The decision emphasizes the legal provisions governing the calculation of duty based on the declared MRP and the implications of tampering with such prices.
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