2016 (3) TMI 515 - AT - Customs

Misdeclaration of value and misdescription of goods - Suppression of the brand name/length of the goods - Imported goods were wiretek brand cables and connectors but declared as cables and connectors - Held that as a voluntary statement was made by the proprietor accepting the non declaration of actual specification with a view to pay lesser amount of duty and it was only under his instructions that the supplier has not given any specifications in the import documents, it proves that there is a misdeclaration of value and misdescription of goods. - Decided in favour of the revenue

Summary

Issues Involved:
Misdeclaration of goods in Bill of Entry under DEPB scheme; Allegations of evasion of duty and suppression of specifications; Rejection of declared value; Determination of total assessable value under Customs Valuation Rules; Levying of differential duty and confiscation of goods; Imposition of penalty under Customs Act.

Analysis:

1. Misdeclaration of Goods and Evasion of Duty:
The case involved M/S Novel Digital Electronics filing a Bill of Entry misdeclaring imported cables and connectors as part of the DEPB scheme. The Directorate of Revenue Intelligence discovered that the goods were "wiretek" brand cables and connectors, and the specifications had been deliberately suppressed to pay lesser duty. The proprietor admitted to instructing the overseas supplier to withhold specifications. The adjudicating authority rejected the declared value, re-determined it, levied differential duty, and confiscated the goods under the Customs Act.

2. Appeal and Retraction of Statements:
The proprietor denied the allegations in response to the show cause notice, arguing that the allegations were unsustainable and lacked probative value. The Commissioner (Appeals) noted the retraction of statements and set aside the Order-in-Original based on precedents and the payment of duty before the notice. The Department challenged this decision, citing inadequate description, reliance on tribunal rulings, and the unreliability of the declared value due to non-disclosure of brand and specifications.

3. Judicial Findings and Precedents:
The Tribunal found that the respondent had failed to declare the actual specifications, leading to undervaluation compared to market prices. The voluntary statement admitting to withholding specifications was considered valid evidence. The Supreme Court judgment on retracted confessions was cited, emphasizing the admissibility of such statements. The Tribunal distinguished the present case from precedents where misdeclaration had not been accepted, upholding the misdeclaration of value and goods in this instance.

4. Decision and Conclusion:
The Tribunal upheld the findings of misdeclaration and evasion of duty, setting aside the Order-in-Appeal and restoring the adjudicating authority's decision. The appeal by the revenue was allowed, affirming the rejection of declared value, determination of assessable value, levying of differential duty, confiscation of goods, and imposition of penalty under the Customs Act.

In conclusion, the judgment addressed the issues of misdeclaration, evasion of duty, retraction of statements, reliance on precedents, and the admissibility of voluntary statements, ultimately upholding the decision of the adjudicating authority and allowing the revenue's appeal.