2015 (7) TMI 261 - AT - Customs

Under-valuation of goods - Imported computer parts - penalties imposed upon the CHA and its Managing Director separately - Held that - As regards M/s. Indam Recycling Pvt. Ltd., we find that the demand of duty to the extent of ₹ 63.46 lakhs stand confirmed on the finding of under-valuation of the computer parts. Learned AR brings it to our notice that the appellant, during the course of investigations, have accepted the under-valuation. Further one of the live consignments, where the investigations were started by the DRI, stand abandoned by the appellant. As such at this prima facie stage, we are of the view that the said M/s. Indam Recycling Pvt. Ltd. has not made out a good prima facie case in its favour so as to dispense with the condition of predeposit of entire duty. Accordingly, we direct M/s.Indam Recycling Pvt. Ltd. to deposit an amount of ₹ 10 lakhs as a condition of hearing of its appeal. - Penalty imposed on the CHA is reduced - Decided partly in favour of Appellant.

Summary

Issues:
1. Confirmation of demand of duty against M/s. Indam Recycling (P) Ltd.
2. Imposition of penalties on CHA firm and its Managing Director.
3. Confirmation of demand of duties against other independent importers.
4. Predeposit conditions for hearing appeals.
5. Compliance timeline for depositing the directed amounts.

Analysis:

The judgment pertains to multiple stay petitions disposed of by a common order due to identical issues arising from three different orders passed by the Commissioner. The Commissioner confirmed a duty demand of approximately Rs. 63 lakhs against M/s. Indam Recycling (P) Ltd. for under-valuation of imported computer parts. Penalties were imposed on the CHA firm responsible for clearing the parts. Similar demands were confirmed against other importers for under-valuation, with penalties imposed on the CHA and its Managing Director separately. Importing firms in two orders did not appeal, leading to dismissal for default.

There were multiple proceedings against the same appellant, the Managing Director of the CHA firm, involving under-valuation allegations. The Tribunal directed the appellant to deposit specific amounts as a condition for hearing appeals, based on previous penalties imposed. M/s. Cafco Freight Systems Pvt. Ltd. was also directed to deposit specific amounts corresponding to penalties imposed on them.

Regarding M/s. Indam Recycling Pvt. Ltd., a duty demand of Rs. 63.46 lakhs was confirmed for under-valuation. The appellant accepted the under-valuation during investigations, and one consignment was abandoned. The Tribunal found that M/s. Indam Recycling Pvt. Ltd. did not establish a strong prima facie case to dispense with the predeposit condition, thus directing them to deposit Rs. 10 lakhs for the appeal hearing.

All directed deposits were required within twelve weeks, and subject to compliance, the predeposit of balance dues against all appellants would be dispensed with, with recovery stayed during the appeal pendency. The matter was scheduled for compliance verification on 28/09/2015.