2012 (8) TMI 56 - AT - Customs

Import - misdeclaration goods have been declared as copper dross and the copper content declared is 85% approx. - On actual testing, it is seen that in respect of goods declared as copper dross, the copper content varies between 96 and 97% - Held that - Mis-declaration on the part of the importer appellant with respect to the copper content under importation - appellant has not placed any purchase orders for the products, especially when the copper content in the product is the main criteria for valuation of the product and the same is much higher than those declared in the import documents - misdeclaration is clearly evident from the records - appellant directed to make a pre-deposit

Summary

Issues:
Misdeclaration of imported goods; Violation of principles of natural justice; Rejection of declared assessable value; Confiscation of goods; Imposition of penalty.

Analysis:
The judgment involves an appeal and stay applications against an Order-in-Original passed by the Commissioner of Customs regarding the misdeclaration of imported copper/brass products by the appellant. The appellant, an importer, declared goods as brass and copper dross with specified copper content in bills of entry. However, upon testing, it was found that the actual copper content varied significantly from the declared percentages, indicating misdeclaration. The goods were in the form of ingots/slabs, not consistent with dross. A show-cause notice was issued proposing reclassification, enhanced assessable value, duty demand, and confiscation of goods, leading to the imposition of a penalty and fine by the Commissioner.

The appellant's advocate argued that the department failed to provide requested documents and denied an opportunity for cross-examination, alleging a violation of natural justice. The advocate also contested the enhanced value based on LME price for copper ingots and highlighted the financial hardship the company would face due to any pre-deposit requirement. The revenue authority supported the adjudicating authority's findings.

Upon careful consideration, the Tribunal observed the misdeclaration by the appellant regarding the copper content of the imported goods, which differed significantly from the declared percentages. The irregular form of the goods further indicated inconsistency with typical dross characteristics. Despite the violation of natural justice due to missed hearings, the Tribunal directed the appellant to make a pre-deposit of Rs.10,00,000 within eight weeks for a fair adjudication process. The matter was remanded to the adjudicating authority for a fresh decision after affording the appellant a reasonable opportunity to present their case.

The judgment ultimately disposed of the appeal and stay applications with the directive for the appellant to comply with the pre-deposit condition within a specified timeframe. The decision aimed to balance the misdeclaration issue with the appellant's financial situation, ensuring a fair adjudication process while upholding principles of natural justice.