2016 (7) TMI 417 - CGOVT - Customs

Valuation - redemption fine and penalty - Claim of benefits of Transfer of Residence (TR) under Rule 8 of the Baggage Rules, 1998. - The goods were found mis declared, undervalued and in commercial quantity, therefore, the same were placed under seizure under Section 110 of the Customs Act, 1962. - Held that - the applicant in his grounds of appeal has contended that valuation of the goods was not based on the invoices provided by him. Government observes that the valuation of the goods has been done by the officers of import shed in consultation with the Appraising Officer on the basis of invoices produced by the passenger and by physical examination of the goods. The applicant failed to declare the true value of the goods brought by him as required under rules and also in his voluntary statement dated 07.08.2012 has accepted the value arrived by the appraising officers and also agreed to pay duty on the goods so assessed. Since value of the goods as assessed by the officers has not been disputed by the applicant, undervaluation of the goods declared by him is established. - the plea of over valuation is not acceptable and the value adopted by the adjudicating authority and upheld by Commissioner(Appeals) is sustained as per law and does not warrant interference. In any case ignorance of law is no excuse not to follow something which is required to be done by the law in a particular manner. This principle has been recognized and followed by the Apex Court in a catena of its judgements. As regards pleading of applicant that heavy amount as fine and penalty has been imposed, Government finds that Commissioner (Appeals) has already taken a very lenient view and considerably reduced the redemption fine from ₹ 1,25,000/- to ₹ 25,000/- and personal penalty from ₹ 75000/- to ₹ 5000/- . As such there is no need to reduce the amount further and Government finds no reason for interference. - Revision application rejected - Decided against the applicant.

Summary

Issues Involved:
1. Valuation of goods.
2. Mis-declaration and under-valuation of goods.
3. Eligibility under Transfer of Residence (TR) Scheme.
4. Imposition of fine and penalty.
5. Ignorance of law as an excuse.
6. Method of valuation by Customs authorities.
7. Reduction of redemption fine and penalty.

Issue-wise Detailed Analysis:

1. Valuation of Goods:
The applicant contended that the valuation of goods was not based on the invoices provided by him. However, the Government observed that the valuation was done by officers in consultation with the Appraising Officer based on the invoices and physical examination. The applicant failed to declare the true value and accepted the value assessed by the officers in his voluntary statement dated 07.08.2012. The undervaluation of goods was established, and no supporting documents were provided to substantiate the declared value. Thus, the plea of overvaluation was rejected, and the valuation adopted by the adjudicating authority was upheld.

2. Mis-declaration and Under-valuation of Goods:
The applicant did not declare the exact description and quantity of goods. For instance, a showpiece golden bird was declared as flowers, and the actual number of crystals was not declared. The applicant's version of declaring a showpiece as flowers and crystals as a set was found unconvincing and not legally tenable. The goods were found misdeclared, undervalued, and in commercial quantity, leading to their seizure under Section 110 of the Customs Act, 1962.

3. Eligibility under Transfer of Residence (TR) Scheme:
The goods brought by the applicant were either not covered as bona fide baggage under the TR Scheme or were misdeclared. Therefore, the contention that the entire goods should have been cleared as duty-free items was incorrect. The adjudicating authority allowed duty-free clearance of used personal effects and household goods valued at Rs. 5 lakhs under Rule 8 of the Baggage Rules, 1998, and ordered confiscation of dutiable goods valued at Rs. 7,52,750/-.

4. Imposition of Fine and Penalty:
The applicant argued that heavy fines and penalties were imposed. However, the Commissioner (Appeals) had already reduced the redemption fine from Rs. 1,25,000/- to Rs. 25,000/- and the personal penalty from Rs. 75,000/- to Rs. 5,000/-. The Government found no reason to reduce the amount further and upheld the fines and penalties imposed.

5. Ignorance of Law as an Excuse:
The applicant's explanation that ignorance of law led to the improper declaration was not accepted. The principle that ignorance of law is no excuse has been recognized and followed by the Apex Court. The explanation was found neither genuine nor creditworthy.

6. Method of Valuation by Customs Authorities:
The valuation method adopted by the Customs authorities was based on the invoices produced by the applicant and physical examination of the goods. Since the applicant did not dispute the assessed value and failed to provide supporting documents, the Government found no infirmity in the valuation method and sustained it as per law.

7. Reduction of Redemption Fine and Penalty:
The Commissioner (Appeals) had already taken a lenient view by considerably reducing the redemption fine and personal penalty. The Government found no reason to interfere further with the reduced amounts.

Conclusion:
The Government upheld the impugned Order-in-Appeal, finding no infirmity in it. The revision application was rejected as devoid of merit. The applicant's arguments regarding valuation, mis-declaration, eligibility under TR Scheme, fines, and penalties were not accepted, and the original orders were sustained.

Order:
The revision application is rejected.