2014 (2) TMI 115 - AT - Customs

Clearance of second quality goods under DEEC Scheme - Valuation of goods - Held that - Both on visual examination by the customs officials and as per the inspection by the NML authorities, the materials were found to be of seconds quality. It has been duly taken note by the adjudicating Commissioner that under the DEEC scheme, no defective/seconds and/or scrap stainless materials were permitted for import. Hence, in our view, he has rightly disallowed clearance under the DEEC scheme and ordered for assessing the same to duty including anti-dumping duty on merits. As regards the value adopted for duty purposes, the appellants can have no grievance as the same has been based on their own declared value and the invoices submitted by them - Decided against assessee.

Summary

Issues:
1. Assessment of duty on goods declared as seconds quality.
2. Clearance under the DEEC scheme.
3. Imposition of redemption fine and penalty.

Analysis:
1. The appeal involved a dispute regarding the assessment of duty on goods declared as seconds quality. The appellants contended that although the customs authorities categorized the goods as seconds quality, they were assessed duty based on a higher declared value. The Tribunal noted that the impugned goods were stainless steel coils of Grade 304, sought to be cleared duty-free under the DEEC scheme. However, both visual examination by customs officials and inspection by NML authorities confirmed the materials to be of seconds quality. The adjudicating Commissioner correctly disallowed clearance under the DEEC scheme for defective/seconds materials, ordering the assessment of duty, including anti-dumping duty, based on the actual quality of the goods.

2. Regarding the clearance under the DEEC scheme, the Tribunal upheld the Commissioner's decision to disallow clearance for defective materials, as per the scheme's guidelines. The value adopted for duty purposes was deemed acceptable, as it was based on the appellants' declared value and submitted invoices. The Tribunal found no grounds for the appellants to contest the duty assessment based on the declared value. Additionally, the redemption fine and penalty imposed were considered reasonable, given the value of the goods involved, amounting to Rs. 28,46,721.

3. The Tribunal concluded that the impugned order required no interference, ultimately dismissing the appeal. The decision was based on the findings that the goods were correctly assessed for duty, considering their actual quality, and that the penalties imposed were justified given the circumstances. The judgment was dictated and pronounced in open court, bringing closure to the legal proceedings in this matter.