2011 (2) TMI 809 - AT - Customs

Confiscation redemption fine and Penalty - Incomplete description of the car imported - the importer had produced an invoice which described the impugned car as Toyota Landcruiser whereas the complete description of the car was Toyota Landcruiser Amazon TD - Importer has not satisfactorily explained how the description of vehicle contained in the invoice and declared in the Bill of Entry is the correct description - It was open to the assessee to establish this position by showing to the authorities that there was no separate price for the Amazon TD model compared and the Toyota Landcruiser manufactured in the same year with reference to the price list of the manufacturer or the Red Book referred to by the importer - In the proceedings before the authorities the importer is not seen to have made any effort to rebut the infirmity found in the declaration for the name of one Mrs. T. William of West Midlands UK figuring as consignor in the Bill of Lading or that the full description Toyota Landcruiser Amazon TD was not declared - It was not satisfactorily explained that the car involved was the same as Toyota Landcruiser - it is up to the assessee to establish that the price declared by it and appearing in the invoice is the transaction value relevant for assessment. - Therefore remand the disputes to the original authority for a fresh decision.

Issues Involved:
1. Legality of the order of confiscation, fine, and penalty.
2. Legality and propriety of the valuation ordered.

Detailed Analysis:

1. Legality of the Order of Confiscation, Fine, and Penalty:

The appellant imported a "Toyota Landcruiser Amazon TD" without the requisite import license and submitted an incomplete and potentially fraudulent invoice. The original authority rejected the invoice value and determined the transaction value based on Rule 9 of the Customs Valuation (Determination of Value of Imported Goods) Rules, 2007. The vehicle was confiscated under Section 111(d) of the Customs Act, 1962, read with Section 3(3) of the Foreign Trade (Development & Regulation) Act, 1992, with a redemption fine of Rs. 4 lakhs and a penalty of Rs. 1,50,000/- imposed under Section 112(a) of the Act.

The Commissioner (Appeals) upheld the original authority's decision, noting the importer's failure to provide relevant details and the submission of a false invoice. The importer accepted the assessed value and admitted to not possessing a registration certificate for the vehicle.

The appellant argued that the assessable value was determined contrary to Section 14(1) of the Act and the CVR, citing previous case law where internet-displayed values were deemed inadmissible. The appellant also contended that the violation of import conditions was technical and did not warrant penalties, referencing several High Court judgments where fines and penalties were set aside for similar technical violations.

The Tribunal observed that the import contravened the import policy, as the vehicle was not in the possession and use of the importer for the prescribed period. The Tribunal also noted that the fine and penalty should be based on the margin of profit, which was not ascertained in this case. Citing previous Tribunal decisions, the Tribunal remanded the aspect of fine and penalty for reconsideration, emphasizing the need to consider the margin of profit and other relevant factors.

2. Legality and Propriety of the Valuation Ordered:

The appellant challenged the rejection of the invoice value, arguing that the declared value should be accepted unless proven otherwise. The appellant cited several case laws supporting the acceptance of transaction value unless special circumstances justified its rejection.

The Tribunal found that the invoice described the car as "Toyota Landcruiser" instead of "Toyota Landcruiser Amazon TD" and lacked details of the shipper, indicating the invoice was false and fraudulently prepared. The Tribunal noted that in none of the cited cases was there an allegation of a fraudulent invoice. The Tribunal emphasized that once the Department showed misdeclaration, the burden shifted to the importer to establish the correctness of the declared value.

The Tribunal found that the importer failed to satisfactorily explain the discrepancies in the invoice and did not make efforts to rebut the Department's findings. The Tribunal concluded that it was up to the importer to establish that the declared price was the transaction value relevant for assessment.

Conclusion:

The Tribunal remanded the disputes to the original authority for fresh adjudication, instructing that both the confiscation, fine, and penalty, as well as the valuation issues, be reconsidered after affording the importer adequate opportunity to present his case. The appeal was allowed by way of remand, with instructions for expeditious resolution within a month of receipt of the order.

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