2013 (9) TMI 28 - AT - Customs

Import of Betel nuts - rejection of declared values and for enhancement of the values Confiscation of goods Redemption fine Penalty Held that - The matter had to be considered afresh after supplying copy of the said documents along with Mahazar and the statements of representative explaining the contents of the said documents order was set aside matter remanded back to the original authority - There was a clear violation of principles of natural justice in not furnishing the Mahazar relating to seizure of documents at the premises and copy of the statement, if any, by the representative - Commissioner had not dealt with some of the submissions by the importers relating to rejection of declared values and consequent enhancement of values for assessment - Commissioner had not adequately dealt with some of the submissions by the importers relating to rejection of declared values and consequent enhancement of values for assessment - The assesses had made some fresh submissions for the first time before us which also requires to be considered Decided in favor of assesses.

Issues Involved:
1. Differential duty demand.
2. Confiscation of goods.
3. Imposition of penalties.
4. Rejection of declared values and enhancement of values.
5. Violation of principles of natural justice.
6. Comparison of import values.
7. Competence of First Secretary (Commerce) to provide trade information.

Detailed Analysis:

1. Differential Duty Demand:
The appellants challenged the orders of the Commissioner demanding differential duties based on enhanced values. The Commissioner had determined that the declared values of the Betel nut consignments were under-declared, leading to the imposition of differential duties on the appellants. The importers resisted this enhancement, arguing that the declared values were accurate and based on direct procurement from exporting countries at lower prices.

2. Confiscation of Goods:
The Commissioner ordered the confiscation of the imported goods, with an option to redeem the same upon payment of fines. The appellants contested the confiscation, claiming there was no justification for such an action. They also argued that the redemption fines imposed were arbitrary and excessively high, leading to significant financial loss.

3. Imposition of Penalties:
Penalties were imposed on the importers alongside the differential duty demands and confiscation orders. The appellants challenged these penalties, arguing that there was no evidence of any extra payment to the importer and that the penalties were unjustified.

4. Rejection of Declared Values and Enhancement of Values:
The Commissioner rejected the declared values of the Betel nut consignments and enhanced the values for assessment based on various evidences, including documents seized from M/s. Integral Traders, import documents of M/s. Nageswari Match Works, and trade information from the First Secretary (Commerce), High Commission of India, Singapore. The appellants argued that these evidences were not reliable and that their declared values should be accepted.

5. Violation of Principles of Natural Justice:
The appellants argued that there was a violation of principles of natural justice as the Mahazar (seizure report) relating to the documents seized from M/s. Integral Traders was not provided to them. The Tribunal agreed with this contention, stating that the document could only be relied upon after providing the Panchnama under which it was recovered.

6. Comparison of Import Values:
The appellants contended that the import values of M/s. Nageswari Match Works were not comparable due to differences in quantity and that the enhancement of provisionally assessed values in that case could not be relied upon. The Tribunal found that the Commissioner had not adequately dealt with the contentions of the assessee regarding the rejection of declared values and enhancement of values.

7. Competence of First Secretary (Commerce) to Provide Trade Information:
The appellants questioned the reliance on the report of the First Secretary (Commerce), High Commission of India, Singapore, arguing that the information was not obtained from the countries of import and was not based on documents from Indonesian authorities. The Tribunal held that the First Secretary (Commerce) was competent to furnish authentic trade information from ASEAN countries.

Conclusion:
The Tribunal found that there was a clear violation of principles of natural justice and that the Commissioner had not adequately addressed the submissions of the importers. The matter was remanded to the original authority for fresh consideration after providing the necessary documents and statements to the appellants. The original authority was directed to grant the appellants an opportunity to make written submissions and to pass a speaking order on the various issues raised, preferably before 31st August 2012.

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