2007 (3) TMI 41 - AT - Customs

Misdeclaration of quantity Alleged that appellant used to misdeclared the quantity of good exported and accordingly imposed penalty on him Held the allegation was not correct and set aside the penalty amount

Summary

Issues: Discrepancy in weight declaration in shipping bills, validity of amendment certificate, determination of DEPB entitlement based on actual weight of exported goods.

Analysis:
1. The case involved investigations into past exports of collar of M.S. Sheet by a company under a claim of DEPB. The investigations revealed discrepancies in the declared weight and the actual weight of the exported goods, leading to a show cause notice denying excess DEPB claimed. The company sought to amend the weight declared in the shipping bills due to typographical errors, which was done by the Deputy Commissioner based on a certificate of amendment. The company argued that DEPB entitlement is based on the declared FOB value, not quantity, and that the weight discrepancies were unintentional. They contended that the amendment certificate validated the weight correction and that freight payment was based on volume, not weight.

2. The Revenue, on the other hand, argued that the original weight declaration significantly affected the cost per kg of the goods, indicating a discrepancy in the number of pieces exported. They questioned the validity of the amendment certificate issued after over a year from export, based on unauthenticated invoices. The Revenue also highlighted inconsistencies in the container's payload capacity concerning the amended weight, as well as discrepancies in freight charges based on weight variations. They contended that the weight originally declared in the shipping bills should be considered for determining the actual number of sets exported for DEPB entitlement.

3. The Tribunal considered the submissions and found no dispute regarding the weight per collar of M.S. sheet or the declared PMV. The Tribunal noted that while the company claimed the goods were examined and found correct by Customs Authorities, they admitted errors in weight declaration. The Revenue contended that the mistake was in the number of sets declared, not the net weight. The Tribunal observed that physically counting the large number of sets declared was impractical, and the amendment certificate issued based on unauthenticated invoices raised doubts. Additionally, discrepancies in shipping documents and freight charges supported the Revenue's argument for considering the originally declared weight.

4. Ultimately, the Tribunal upheld the decision to limit the DEPB benefit based on the actual weight of the exported goods, calculated by dividing the total net weight declared in the shipping bills by the weight of one set of M.S. collar. The Tribunal also upheld the penalty imposed on the company's proprietor. The appeal was dismissed, affirming the Commissioner's findings regarding the DEPB entitlement based on the actual weight of the exported goods.

This detailed analysis of the judgment highlights the key arguments presented by both parties, the Tribunal's considerations, and the final decision regarding the DEPB entitlement based on the weight discrepancies in the shipping bills.