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2011 (4) TMI 669 - AT - CustomsDuty liability - Shortage of the quantity of 7469 kgs. of CCL imported by availing the benefit of Notification No.25/99(Cus) read with Customs (Import of Goods on Concessional rate of duty for manufacture of Excisable goods) Rules 1996 - Appellant is not able to prove their case - As per the said Customs Rules it is mandated that the appellant should and maintain the stock registers of the goods imported at concessional rate of duty for the use in his factory - In the absence of any such evidence that the said short found quantity was in fact used by the appellant in his factory premises for the purpose of manufacture - Decided against the assessee. As regards the penalty imposed on the Managing Partner of RRE u/s 112(a) - Find that he was the person who was looking after the day-to-day affairs of the company he should have been more diligent to check and counter-check the stock position in his factory premises - Due to his non-effective supervision there was a shortage of 7469 kgs. of CCL which were imported under concessional rate of duty - Hence, uphold the penalty on the Managing Partner. Demand - Misdeclared the description and value of the goods - there is no evidence that the said declaration of description was incorrect or mis-declared as there is no chemical examiner s report of the drawn sample if any - if an expert opinion indicates that the sample of imported goods on visual inspection is of sub-standard and there being no contrary evidence from any other expert or chemical examiner we concur with the findings in the impugned order - In the absence of any evidence to indicate that the goods which were imported and cleared during the material period were not rejects but were of prime quality - Decided in favour of assessee.
Issues Involved:
1. Duty liability for the shortage of 7469 kgs. of Copper Clad Laminates (CCL). 2. Penalty imposed on the Managing Partner of RRE under Section 112(a) of the Customs Act, 1962. 3. Department's appeal against the dropping of demands on the allegation of mis-declaration of goods. Detailed Analysis: 1. Duty Liability for Shortage of 7469 kgs. of CCL: The appellant, M/s. R.R. Enterprises (RRE), was unable to prove that the short-found quantity of 7469 kgs. of CCL was used in their factory premises for manufacturing purposes. According to the Customs (Import of Goods on Concessional rate of duty for manufacture of Excisable goods) Rules, 1996, it is mandated that the appellant should maintain stock registers for goods imported at a concessional rate of duty. In the absence of such evidence, the adjudicating authority's findings confirming the demand were upheld. Consequently, the appeal concerning this issue was rejected. 2. Penalty Imposed on the Managing Partner of RRE: The Managing Partner of RRE was penalized under Section 112(a) of the Customs Act, 1962, for his failure to supervise effectively, resulting in a shortage of 7469 kgs. of CCL imported at a concessional rate of duty. The adjudicating authority imposed a penalty of Rs.50,000/-. However, considering the facts and circumstances, the penalty was deemed disproportionate to the confirmed duty demand. Therefore, the penalty was reduced to Rs.25,000/-, while upholding the imposition of the penalty. 3. Department's Appeal Against Dropping of Demands on Allegation of Mis-declaration: The adjudicating authority had dropped the demands issued on the allegation of mis-declaration of the goods, stating that the evidence provided by the Revenue was insufficient. The test report by M/s. Bakelite Hylam Ltd. indicated that the goods conformed to NEMA and MIL standards despite being visually sub-standard. The adjudicating authority found no conclusive evidence to prove that the goods were of prime quality and mis-declared as "C" grade. The Department argued that the adjudicating authority misinterpreted the report and failed to consider corroborative evidence. However, the Tribunal found that the adjudicating authority's decision was consistent with a prior decision in a similar case involving the same respondent. The Tribunal also referenced the case of Crystal Dot Scan Pvt. Ltd. Vs. CC&CE, Hyderabad-II, where it was held that the Revenue must establish details of contemporaneous imports to reject the declared value. Since the Revenue did not provide valid reasons or evidence of contemporaneous imports at a higher price, the appeal filed by the Revenue was rejected. Conclusion: - The appeal concerning the duty liability for the shortage of 7469 kgs. of CCL was rejected. - The penalty imposed on the Managing Partner was reduced from Rs.50,000/- to Rs.25,000/-. - The Department's appeal against the dropping of demands on the allegation of mis-declaration was rejected.
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