2016 (10) TMI 1163 - AT - Customs

Valuation - appellants grievance is that with the setting aside of enhancement of valuation, the Tribunal should have given further relief in RF and Penalty, whereas there is no discussion by the Tribunal as regards the quantum of RF and Penalty - Held that - By setting aside the undervaluation aspect, the Tribunal observed that appeal is allowed to that extent, without adverting to the quantum of RF and Penalty - we allow the ROM and proceed to decide the quantum of RF and Penalty - ROM application disposed off.

Summary

Issues:
1. Misdeclaration of imported goods - valuation and quantity.
2. Policy violation regarding import license.
3. Appeal against original adjudicating authority's order.
4. Challenge before the Tribunal regarding under-valuation of goods.
5. Relief sought in Redemption fine (RF) and Penalty.
6. Tribunal's discussion on RF and Penalty.
7. Determination of duty amount for undervaluation.
8. Reduction of RF and Penalty by the Tribunal.

Analysis:
1. The case involved the misdeclaration of imported used tyres with and without metallic frames, leading to proceedings by the Revenue due to undervaluation and policy violations. The original adjudicating authority's order was appealed, resulting in the Commissioner (Appeals) setting aside undervaluation charges for tyres with metallic frames but upholding charges for tyres without metallic frames and policy violations.

2. The Tribunal's final order dated 4-7-2014 set aside the undervaluation of tyres without metallic frames but upheld misdeclaration in quantity and policy violation findings. The appellants contended that with the undervaluation aspect set aside, the Tribunal should have provided further relief in Redemption fine (RF) and Penalty, which was not discussed by the Tribunal.

3. Upon reviewing the case, the Tribunal found the appellants' contentions to be correct. The Tribunal observed that by setting aside the undervaluation aspect, the appeal was allowed to that extent without addressing the quantum of RF and Penalty. Consequently, the Tribunal allowed the Review Order Modification (ROM) application to decide the quantum of RF and Penalty.

4. The Revenue was unable to provide the exact differential duty amount for undervaluation but estimated it to be around 2.5 lakhs for both types of tyres. Considering the similarity in the quantity of both types of imported tyres, the Tribunal reduced the RF from &8377; 1.75 lakhs to &8377; 1 lakh and the penalty from &8377; 50,000 to &8377; 25,000. However, the separate penalty of &8377; 25,000 for policy violation remained unchanged.

5. The ROM application was disposed of with the Tribunal's decision on the reduction of RF and Penalty based on the duty difference estimation for undervaluation of the imported tyres. The judgment clarified the adjustments made in RF and Penalty while maintaining the penalty for policy violation.