2017 (1) TMI 1542 - AT - Customs

Misdeclaration of goods - finished leather - Public Notice No. 21/2009-14, dated 1-12-2009 - Held that - in the entire order there is no finding that the impugned leather was not finished leather or was semi-finished leather and the only finding is that does not satisfy the norms and conditions for the type of finished leather as declared. There is no other evidence to suggest any contumacious conduct or deliberate misdeclaration - appeal dismissed - decided against Revenue.

Summary

Issues:
1. Department's appeal against the order-in-appeal passed by the Commissioner of Customs (Appeals), New Delhi regarding the export of Goat Upper Finished Leather with Finishing Coat to France.
2. Discrepancy in the certification of the goods by the Central Leather Research Institute (CLRI).
3. Allegation of violation of provisions of the Customs Act, 1962 by the Exporter/CHA.
4. Appeal filed by the Department against the order-in-original set aside by the Commissioner (Appeals).

Analysis:
1. The Department filed an appeal against the order-in-appeal passed by the Commissioner of Customs (Appeals), New Delhi. The case involved the export of Goat Upper Finished Leather with Finishing Coat to France. The Exporter/CHA filed Shipping Bill No. 6616334, processed by the EDI system, declaring a FOB value of EURO 88587.50. The goods were examined by the designated Customs Officer and certified by CSIR - Central Leather Research Institute, Chennai. However, a subsequent report from CLRI indicated that the sample did not satisfy the required norms of finished leather, leading to allegations of violation of the Customs Act, 1962.

2. The dispute arose due to a discrepancy in the certification of the goods by CLRI. While an earlier report found the leather satisfactory, a later report stated that the sample did not meet the required norms and conditions for finished leather. The issue centered around the absence of a finishing coat, which was necessary for export as per Public Notice No. 21/2009-14. The report's vagueness in specifying the unsatisfactory operation was highlighted, with no evidence of deliberate misdeclaration or contumacious conduct found. The judgment emphasized the lack of findings regarding the leather being unfinished or semi-finished, with the only objection being the failure to meet declared norms and conditions.

3. The Commissioner (Appeals) set aside the order-in-original with consequential relief, prompting the Department to file the present appeal. After hearing arguments from both sides, the Tribunal found no reason to interfere with the impugned order. The judgment sustained the order-in-appeal, citing the lack of evidence to support deliberate misdeclaration or contumacious conduct. Consequently, the appeal filed by the Department was dismissed, and the decision was pronounced in open court on 31-1-2017.