2015 (1) TMI 671 - AT - Customs

Demand of differential duty - Pre deposit ordered - Appeal dismissed for non-compliance with the provisions of Section 129E of the Customs Act, 1962 - Held that - Neither in the interim order nor in the final order passed by the lower appellate authority, there is any finding or reasoning given as to why the appellant was directed to make a pre-deposit of ₹ 5 lakhs by the proprietor and the entire differential duty liability by the proprietary firm. There is only one single sentence by way of which the appellate authority has come to the decision to order pre-deposit - Inasmuch as the lower appellate authority has not given sufficient reasons for ordering the pre-deposit, the matter has to go back to the said authority for disposal of the appeal on merits - Matter remanded back - Decided in favour of assesse.

Issues:
1. Dismissal of appeals for non-compliance with Customs Act provisions.
2. Allegation of undervaluation of imported goods.
3. Invocation of extended time period for show cause notice.
4. Lack of reasoning for pre-deposit order.
5. Remand of the matter to lower appellate authority for further consideration.

Issue 1: Dismissal of appeals for non-compliance with Customs Act provisions:
The lower appellate authority dismissed the appeals by M/s. Daga International and its proprietor for not complying with Section 129E of the Customs Act, 1962. The appellants argued that the interim order was passed ex-parte without considering their submissions. The case involved undervaluation of imported tools from Singapore, with the Revenue claiming that the prices declared were significantly lower compared to similar goods imported by authorized dealers in India. The appellant provided evidence of contemporaneous values of imports by other importers, but these were allegedly not considered by the lower appellate authority.

Issue 2: Allegation of undervaluation of imported goods:
The Revenue contended that there was a solid basis for enhancing the value of the imported goods, supported by reports and information from official channels and authorized distributors. The declared value by the appellant was allegedly much lower than that of other importers, leading to suspicions of undervaluation. The lack of a satisfactory explanation for the low values declared supported the charge of undervaluation.

Issue 3: Invocation of extended time period for show cause notice:
The show cause notice was issued invoking the extended period of time, with the Revenue claiming that there was no evidence of the appellant making additional payments beyond the declared amounts. The dismissal of appeals by the lower appellate authority was challenged on the grounds of lack of sustainable legal basis.

Issue 4: Lack of reasoning for pre-deposit order:
The appellate authority ordered a pre-deposit without providing sufficient reasoning, merely stating that the case involved a pre-meditated modus operandi. The lack of detailed justification for the pre-deposit led the Tribunal to remand the matter back to the lower appellate authority for a decision on merits after considering all evidence and submissions.

Issue 5: Remand of the matter to lower appellate authority:
The Tribunal remanded the case back to the lower appellate authority for a decision on merits, emphasizing the need for a reasoned order after reviewing the evidence and allowing the appellant a fair opportunity to present their case. As a result, the Tribunal decided not to order any pre-deposit at that stage, ensuring a fair process for further consideration of the appeal and stay petitions.

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