2008 (3) TMI 548 - AT - Customs

Summary

Issues: Misdeclaration of goods description and value, confiscation of goods, penalty imposition, valuation of imported goods

Misdeclaration of Goods Description and Value:
The case involved the import of silk yarn declared as "Handspun Mulberry Native Silk Yarn" but later found to be "Dupion Raw Silk" through testing by the Textile Committee and the Central Silk Board. The authorities proposed to demand differential duty due to the higher grade of the imported goods compared to the declared value. The Commissioner of Customs adjudicated the case, classifying the goods as "Dupion Raw Silk" and determining the value at USD 21 per kg. The appellant contested the misdeclaration, citing previous tribunal decisions, but the Tribunal upheld that misdeclaration under Section 111(m) of the Customs Act was established without the need to prove mens rea. The misdeclaration of value was also confirmed based on contemporaneous import bills, leading to the imposition of a penalty and confiscation of goods.

Confiscation of Goods and Penalty Imposition:
The Tribunal accepted the arguments presented by the department, upholding the misdeclaration of the goods and the consequent confiscation and penalty. The appellant's claim of declaring the goods correctly based on import documents was dismissed, emphasizing the discrepancy between the declared description and the actual nature of the imported goods. The Tribunal referenced previous court decisions to support the decision on confiscation and penalty, emphasizing the importance of accurate declaration without the requirement of proving intent.

Valuation of Imported Goods:
Regarding the valuation of the goods, the consultant argued that the lowest value of contemporaneous imports should have been considered by the adjudicating authority. The Commissioner had chosen a value of USD 21 per kg, but the consultant pointed out a Bill of Entry dated 8-11-2005 declaring a value of USD 19 per kg for similar goods. The Tribunal agreed with the consultant, stating that under Rule 6 of the Valuation Rules, the lowest contemporaneous price should be adopted. The Tribunal directed the re-quantification of duty based on the unit price of USD 19 per kg, reducing the quantum of fine and penalty imposed by the Commissioner.

In conclusion, the Tribunal upheld the misdeclaration of goods description and value, leading to the confiscation of goods and imposition of a penalty. The valuation of the imported goods was revised based on the lowest contemporaneous price, resulting in a modification of the original order to reduce the fine and penalty amounts while directing the re-quantification of duty.