2013 (8) TMI 542 - AT - Customs

Under valuation of goods - smuggled goods - appellant failed to explain the reason of under valuation department re-determined the value and upon confiscation thereof imposed the duty with option to redeem the goods on payment of fine and Penalty Held that - There was no exorbitant redemption fine and penalty imposed - the valuation adopted in adjudication does not appear to be baseless - the appellant did not come out with cogent evidence to support to its claim of declaration of proper value - appellant agreed to the enhancement during adjudication - it was difficult to disturb the adjudication at that stage since import was not made in terms of prescribed procedure of law rendering such goods to be smuggled goods Once the goods are held to be smuggled goods under section 2 (39) of Customs Act, 1962, there was no scope at all to interfere to the adjudication decided against the assessee.

Summary

Issues:
Import of goods through unauthorized port, undervaluation of goods, imposition of duty and penalty, justification of adjudication decision.

Analysis:
The judgment pertains to a case where the appellant imported CR sheet secondary/defective goods from Malaysia through an unauthorized port, Dadri, instead of the specified ports as required by the foreign trade policy of 2004-2009. The goods were also found to be undervalued, leading to an investigation by the authorities. The adjudicating authority re-determined the value of the goods, imposed duty on the appellant, and provided an option to redeem the goods upon payment of a fine of Rs.3,50,000. Additionally, a penalty of Rs.35,000 was imposed on the appellant.

During the proceedings, the appellant contended that the goods were delivered at Dadri due to a lack of knowledge and not with the intention of acting against the law by undervaluing the goods. The revenue department supported the adjudication decision. After hearing both sides and examining the record, the tribunal observed that the appellant had agreed to the enhancement during adjudication, making it difficult to disturb the decision at that stage. The tribunal concluded that the import was not made in accordance with the prescribed procedure of law, rendering the goods as smuggled goods under section 2(39) of the Customs Act, 1962. As a result, the tribunal found no grounds to interfere with the adjudication decision.

Furthermore, the tribunal noted that the valuation adopted in the adjudication was reasonable since the appellant failed to provide substantial evidence to support its claim of declaring the proper value of the goods. The tribunal also considered the redemption fine and penalty imposed as not exorbitant. Therefore, the tribunal confirmed the adjudication decision, dismissing the appeal made by the appellant. The judgment highlights the importance of complying with the prescribed procedures and regulations while importing goods to avoid penalties and confiscation of goods due to non-compliance with the law.