2007 (1) TMI 37 - AT - Customs

Confiscation, fine & penalty Alleged that description and thevalue of the goods had been misdeclared by the appellant and accordingly fine and penalty imposed on him After considering the detail authority find the allegation right and fine and penalty are sustained.

Summary

Issues:
1. Misdeclaration of imported goods - iron scrap and diesel engines.
2. Confiscation of goods under Sections 111 and 119 of the Customs Act.
3. Valuation of seized diesel engines and iron scrap.
4. Imposition of redemption fine, penalty, and adjustment of previous payment.
5. Interpretation of Section Note 8(a) of the Customs Tariff Act.
6. Comparison with previous tribunal decisions regarding similar cases.

Analysis:

1. The case involved the misdeclaration of imported goods, where the appellants imported iron scrap mixed with used diesel engines of TOYOTA, IZUZU, and NISSAN models. The discrepancy in weight and the condition of the engines led to suspicions of misdeclaration by the importer.

2. The Commissioner of Customs ordered the confiscation of the iron scrap and diesel engines under Sections 111 and 119 of the Customs Act, respectively. The misdeclaration of the engines as scrap and the concealment of engines within the genuine scrap led to the confiscation.

3. The valuation of the seized 300 used diesel engines was fixed based on the Chartered Engineer's certificate at Rs. 23,25,500, and duty was charged accordingly. The iron scrap was valued at Rs. 5,31,486, and a redemption fine was imposed in lieu of confiscation.

4. The Commissioner imposed a redemption fine, penalty, and adjusted the previous payment made during the investigations towards the duty payment liabilities. The fine and penalty were considered reasonable based on the value of the seized goods and previous tribunal decisions.

5. The Counsel argued for the engines to be treated as 'waste and scrap' under Section Note 8(a) of the Customs Tariff Act. However, the Tribunal rejected this argument, stating that the engines were capable of being used after minor operations, thus not falling under the definition of waste and scrap.

6. The Tribunal compared the present case with previous tribunal decisions involving similar situations of misdeclaration and confiscation of goods. The fines, penalties, and confiscations imposed in the present case were found to be reasonable and in line with the decisions of the Tribunal in similar cases.

In conclusion, the Tribunal upheld the impugned order, dismissing the appeal and affirming the confiscation, valuation, redemption fine, and penalty imposed by the Commissioner of Customs.