2006 (12) TMI 281 - AT - Customs

Summary

Issues involved:
The issues involved in the judgment are the rejection of the appellant's claim for drawback under proviso 2 to Section 75 of the Customs Act, 1962, and the imposition of a personal penalty under Section 114(iii) of the Act based on mis-declaration of goods.

Description of Goods:
The dispute regarding the description of the goods exported by the appellant was raised, where the contract with the foreign buyer specified "Polyester/Viscose Fancy Trousers" while the shipping bill described them as "Men's Exclusive Woven Trousers." The appellant explained the discrepancy, attributing it to specificity in the contract versus generality in the shipping bill. Despite the adjudicating authority's doubts, the absence of objections from the buyer in Dubai indicated that the goods were in accordance with the contract, and minor variations in description did not impact the acceptance by the buyer.

Market Value Dispute:
Regarding the market value of the export consignment, the authorities did not contest the FOB value but disputed the market value. The adjudicating authority calculated the value of fabrics used for stitching the trousers based on the balance sheet, leading to a discrepancy in the claimed drawback amount. The appellant argued that the value of fabrics should have been accepted as correct, and the method used by the Commissioner to determine the value was flawed. The Tribunal found merit in the appellant's contentions and disagreed with the adjudicating authority's reasoning, ultimately setting aside the impugned order.

Remittance from Foreign Buyer:
The issue of remittance from the foreign buyer was raised, with the appellant receiving payments in instalments after the stipulated time limit. The Commissioner questioned the genuineness of the remittance due to delays and the method of receipt. However, the Tribunal noted that the appellant faced financial difficulties, and the entire realization of payments by the appellant validated the genuineness of the remittance. Rule 16A of the Customs and Central Excise Duties Drawback Rules, 1995, was referenced, but the Tribunal clarified its applicability only after drawback payment, not during consideration. The Tribunal disagreed with the Commissioner's conclusions, emphasizing the lack of concrete evidence to deny the appellant's drawback claim.