2011 (7) TMI 174 - AT - Customs

Waiver of pre-deposit of redemption fine and penalties - Confiscation - Board vide Circular No.15/97-Cus dated 3.6.97 - It is his submission that there is a definite misdeclaration as regards the description of the goods in one shipping bill which was found to be of 100% viscose materials of non-texturised instead of polyester yarn - assessee is not in a position to correctly satisfy us that there was no misclaration of the quantity - Since there is misdeclaration of the description, quantity and the value in respect of 3 consignments which were meant for export, we hold that the goods are liable for confiscation - Appeal is disposed of

Summary

Issues:
Stay applications for waiver of pre-deposit of redemption fine and penalties imposed by the adjudicating authority.

Analysis:
The judgment pertains to two stay applications filed for the waiver of pre-deposit of redemption fine and penalties imposed by the adjudicating authority. The consignment of textiles meant for export was detained based on intelligence, leading to discrepancies in the declared goods upon examination. The Textile Committee report revealed misdeclarations in the consignment, resulting in overvaluation. The adjudicating authority ordered confiscation of the goods under three shipping bills, imposing a redemption fine and penalties. The appellant contested the show-cause notice, arguing procedural errors and misinterpretation of regulations. The appellant also highlighted losses incurred due to the delay caused by the seizure.

The appellant's counsel argued that the show-cause notice was issued beyond the prescribed period of six months, challenging the correctness of the entire notice. Additionally, the appellant contended that the authorities disregarded requests for provisional release of the goods for export, contrary to established directives. The counsel further disputed the valuation discrepancies, citing differences in declared value and actual procurement cost. The appellant claimed that the shortage in one shipping bill was a clerical error and questioned the application of relevant sections of the Customs Act due to the absence of a filed shipping bill. The counsel emphasized the adverse impact on business due to the seizure and subsequent cancellation of export orders.

The respondent's representative differentiated between seizure and detention of goods, asserting misdeclarations in quantity, value, and description of goods in the consignment. The respondent relied on legal precedents to support the findings of misdeclaration and the consequent liability for confiscation. The respondent highlighted discrepancies in the declared value and the actual procurement cost, reinforcing the misdeclaration allegations.

After considering both parties' arguments and examining the factual matrix, the judgment acknowledged misdeclarations in the consignment, leading to liability for confiscation. Despite the misdeclarations, a lenient view was taken, resulting in a reduction of the redemption fine and penalties imposed. The judgment modified the fines and penalties, reducing the amounts significantly based on the circumstances of the case. The penalty imposed on one individual was set aside, and the appellants were permitted to take back the goods upon payment of the revised fines and penalties. The judgment upheld the impugned order, disposing of the appeals on merit.

In conclusion, the judgment addressed the issues raised in the stay applications, analyzed the discrepancies in the consignment, considered legal arguments from both sides, and ultimately modified the fines and penalties imposed by the adjudicating authority.