2016 (11) TMI 1518 - AT - Customs

Valuation - memory cards of 2 GB and 4 GB - contention of the appellant is that though there was misdeclaration, but the same was not intentional inasmuch as the declaration of the value was based upon the invoices raised by the foreign supplier - Held that - appellant s arguments that the said misdeclaration was not intention, cannot be appreciated inasmuch as the intention, which is only in the mind of a person has to be gathered from the circumstances. The appellant very well knew that the value of the goods was much on the lower side as they themselves imported the same at a higher value vide previous Bill of Entry. As such, it was their legal obligation to declare the correct value in the Bill of Entry - demand of duty with penalty upheld. Redemption fine - Held that - Inasmuch as the differential duty was around ₹ 95,000/- for which the adjudicating authority has imposed a penalty of same amount, we deem it fit to reduce the same to ₹ 95,000/-. Appeal dismissed except reduction of redemption fine.

Summary

Issues: Valuation of memory cards, Undervaluation, Imposition of penalty, Confiscation of goods, Redemption fine

The judgment by the Appellate Tribunal CESTAT NEW DELHI involved a dispute regarding the valuation of memory cards of 2 GB and 4 GB. The appellant had initially declared the assessable value of the goods at ?57,226, attracting customs duty of ?5,860. However, during investigation, it was revealed that the same goods had been imported previously at a higher value of ?110.20 per piece. This discrepancy led to a reassessment of the value at ?9,98,550, with customs duty of ?1,05,252. The original adjudicating authority upheld the undervaluation charge, confirmed the differential duty demand, imposed a penalty of ?95,000, and allowed redemption of goods upon payment of a fine of ?1.90 lakh.

The appellant argued that the misdeclaration was unintentional, based on invoices from the foreign supplier, and sought a reduction in penalties and redemption fine. The Departmental Representative contended that the lower valuation was a deliberate attempt to evade duty. The Tribunal noted that the appellant's claim of unintentional misdeclaration was not credible, as they had previously imported the same goods at a higher value. The Tribunal upheld the differential duty and penalty of ?95,000, citing the appellant's legal obligation to declare the correct value.

Regarding the redemption fine, the Tribunal found the adjudicating authority's decision to impose a fine of ?1.90 lakh without proper justification excessive. Considering the penalty amount was also ?95,000, the Tribunal reduced the redemption fine to match the penalty amount. Consequently, the appeal was rejected, with modifications made to reduce the redemption fine to ?95,000.