2016 (3) TMI 1139 - AT - Customs

Duty drawback - confiscation - mis-declaration of description of goods - fraudulent export - Held that - there is no dispute that the goods attempted to be exported is unfinished leather as per CLRI report whereas the appellant has mis-declared as finished goods. The drawback is available on finished leather therefore it is clearly established that the misdeclaration of the goods is with clear intention to claim fraudulent drawback. Right from the adjudication and first appellate stage, the appellant though submitted that there is violation of principles of natural justice but the fact that the goods were mis-declared could not be rebutted. The Commissioner (Appeals) with proper application of mind, considering all the aspects taken lenient view and accordingly reduced the redemption fine and penalties - there is no infirmity in the impugned order - appeal dismissed - decided against appellant.

Summary

Issues:
- Misdeclaration of goods for export under duty drawback scheme
- Confiscation of goods and imposition of redemption fine and penalty
- Reduction of redemption fine and penalty by the Commissioner(Appeals)
- Appeal for waiver of reduced penalty

Analysis:
1. Misdeclaration of Goods:
The case involved the misdeclaration of goods for export under the duty drawback scheme. The appellant declared unfinished leather as finished leather, attempting to claim a fraudulent drawback. The Central Leather Research Institute (CLRI) confirmed that the samples were not of finished leather, leading to the confiscation of the goods.

2. Confiscation and Imposition of Fine and Penalty:
The adjudicating authority imposed a redemption fine of &8377; 3.50 lakhs and a penalty of &8377; 1.50 lakhs under Sections 125 and 114(i) of the Customs Act, 1962, respectively. The appellant appealed for waiver of these amounts before the Commissioner(Appeals).

3. Reduction of Fine and Penalty:
The Commissioner(Appeals) upheld the confiscation but reduced the redemption fine to &8377; 2.65 lakhs and the penalty to &8377; 1 lakh. The reduction was based on considerations of the appellant's submissions and the facts of the case. The appellant further appealed for a waiver of the reduced penalty.

4. Judicial Precedents and Final Decision:
The appellate tribunal referred to various judicial pronouncements to support the decision. It was noted that misdeclaration, even if unintentional, renders the goods liable for confiscation and the imposition of fine and penalty. The tribunal upheld the reduction of the redemption fine and penalty, considering the FOB value of the impugned goods.

In conclusion, the tribunal upheld the Order-in-Original with modifications to the redemption fine and penalty. The appeal was dismissed, as there was no infirmity in the impugned order. The decision was based on the misdeclaration of goods, the application of legal principles, and relevant judicial precedents.