2016 (1) TMI 190 - AT - Customs

Levy of anti dumping duty - Delay in conducting search - Held that - It is apparent that they mis-declared the tiles as Ceramic tiles which could have resulted in huge loss of anti dumping duty, therefore the goods are liable to confiscation under Section 111(d) and 111(m) of the Customs Act. Ld. Counsel prayed for reduction in fine. He has not been able to inform the Bench as what is margin of profit to enable us to determine appropriate amount of fine and penalty. At the same time, we do find that invoices accompanying the tiles described the same as Ceramic Tiles. - Delay in search conducted by the Custom is difficult to comprehend. This may have given chance to importer to write to the supplier but nevertheless as recorded by the Ld. Commissioner, letter was recovered during the search which is not established that the latter was afterthought. Another letter dated 22/9/2003 is also referred to in the adjudication order which is letter from the supplier for which he expressed his willingness to take back the goods supplied to the importer. - Since duty paid before issuance of SCN - Redemption fine and penalty is reduced - Decided partly in favour of assessee.

Summary

Issues: Misdeclaration of imported goods as Ceramic Floor Tiles, liability for anti-dumping duty, confiscation of goods, imposition of fine and penalty, reduction in redemption fine and penalty.

Analysis:
The appellant imported goods declared as Ceramic Floor Tiles but were found to be vitrified tiles attracting anti-dumping duty. The Director of the importer's firm admitted knowledge of the misdeclaration and agreed to pay the differential duty. The goods were held liable for confiscation under Sections 111(d) and 111(m) of the Customs Act due to the contravention of trade regulations. The Commissioner upheld the confiscation, imposed a fine of &8377; 6 lakhs, and a penalty under Section 112(a). The amount paid towards anti-dumping duty was appropriated.

The appellant argued that commercial invoices described the goods as Ceramic tiles, and they had rejected the defective tiles in correspondence with the supplier. The supplier agreed to take back the goods. The appellant requested leniency and reduction in the redemption fine and penalty, stating that the fine exceeded their profit margin.

The Tribunal considered both sides' submissions and acknowledged the misdeclaration of goods as Ceramic tiles, resulting in potential loss of anti-dumping duty. The appellant's request for reduction in fine lacked information on profit margin for determining the appropriate penalty. However, the invoices described the goods as Ceramic Tiles, and correspondence with the supplier indicated rejection of defective tiles. Despite delays in the search conducted by Customs, the recovery of letters during the search supported the appellant's contentions. The Tribunal reduced the redemption fine from &8377; 6 lakhs to &8377; 4 lakhs and the penalty under Section 112(a) from &8377; 2 lakhs to &8377; 1 lakh, considering the payment of anti-dumping duty before the show cause notice.

In conclusion, the appeal was partly allowed by reducing the redemption fine and penalty, ensuring justice based on the circumstances and facts presented during the proceedings.