2008 (4) TMI 616 - AT - Customs

Summary

Issues:
1. Valuation of imported goods declared as lead ash but found to be cadmium dross.
2. Confiscation and redemption fine imposition.
3. Misdeclaration of goods and value assessment.
4. Appeal against the Commissioner (Appeals) decision on value calculation.
5. Reduction of penalty and redemption fine.

Issue 1 - Valuation of Imported Goods:
The appellants imported goods declared as lead ash but were found to be cadmium dross. The Customs laboratory and C.R.C.L. Delhi tests revealed varying cadmium content. The Commissioner (Appeals) determined the value of the imported cadmium dross at US $ 650 P.M.T., totaling Rs. 3,49,212/-. The appellants contested the value calculation based on the price of virgin Cadmium metal, arguing it should be based on the Cadmium ash/dross price. The Tribunal upheld the Commissioner's valuation, considering the cadmium metal content and conversion cost.

Issue 2 - Confiscation and Redemption Fine:
The goods were provisionally cleared under the belief they were lead ash but contained cadmium. The Tribunal acknowledged the misdeclaration and the liability for confiscation. The appellants' argument against the redemption fine imposition was dismissed as the goods were cleared provisionally. The Tribunal upheld the confiscation and redemption fine, reducing the penalties to Rs. 50,000 each.

Issue 3 - Misdeclaration and Value Assessment:
The appellants' contradictory statements regarding the use of imported goods for lead ingots manufacturing raised doubts. Despite misdeclaration and the presence of cadmium, the Tribunal affirmed the confiscation and redemption fine, citing settled legal principles. The Tribunal rejected the appellants' request to rework the value based on the price of cadmium ash as they failed to provide supporting evidence.

Issue 4 - Appeal Against Value Calculation:
The Tribunal reviewed the Commissioner (Appeals) decision on value calculation, which was based on Customs Valuation Rules, 1988. The Tribunal found the valuation method reasonable, considering the cadmium content in the imported goods and the international market price of cadmium metal. The Tribunal upheld the value calculation and rejected the appeal against it.

Issue 5 - Reduction of Penalty and Redemption Fine:
While rejecting the appeal on merit, the Tribunal reduced the penalty and redemption fine imposed on the appellants to Rs. 25,000 each. This reduction was based on the facts and arguments presented by the appellants, showing leniency in the penalties imposed.

In conclusion, the Tribunal affirmed the valuation of the imported cadmium dross, upheld the confiscation and redemption fine, rejected the appeal against the value calculation, and reduced the penalty and redemption fine imposed on the appellants.