2007 (9) TMI 124 - AT - Customs

Mere higher valuation and demand of duty doesn t mean mis declaration Certificate by Govt. of foreign supplier certify declared value of goods Imports cannot be considered contemporaneous, if involve very less quantity Confiscation, enhancement of value & penalty set aside

Summary

Issues:
1. Rejection of transaction value for import of Zanzibar cloves.
2. Confiscation and enhancement of value by the Commissioner of Customs.
3. Imposition of penalty on the importer.

Analysis:
1. The appellants declared a transaction value of US $400 per MT for the import of Zanzibar cloves, but the Commissioner of Customs rejected this value and loaded it to 850 US $ per MT. The Commissioner confirmed a differential duty and confiscated 100 MT of cloves, ordering recovery of Rs. 30 lakhs under a bond and imposing a penalty of Rs. 50 lakhs on the importer's proprietor.

2. The Tribunal found that the reliance placed by the Commissioner on the value of consignments cleared in December 1993 and January 1994 was misplaced, as these imports were not contemporaneous with the bulk quantity imported by the appellant. The Tribunal referred to previous decisions to support the appellants' argument against the value enhancement based on the spice market weekly price and the acceptance of a different price range by the customs department for superior quality cloves.

3. The Commissioner heavily relied on a statement by the appellant's proprietor, which was later retracted and supported by documentary evidence. The Tribunal noted that the clearance of goods at a higher duty did not necessarily indicate misdeclaration of value, especially considering the perishable nature of the goods. The Tribunal cited legal precedents to emphasize that value enhancement cannot solely rely on the importer's statement.

4. In conclusion, the Tribunal held that the confiscation, enhancement of value, and penalty imposed were not sustainable. Therefore, the impugned order was set aside, and the appeal was allowed. The judgment was pronounced in court, ending the legal proceedings in favor of the appellants.