2016 (12) TMI 575 - AT - Customs

Valuation - mis-declaration of value of goods - heavy melting scrap - high-seas sale - provisional release of goods - Held that - I find that the conditions imposed for provisional release are excessive and accordingly I modify the same as i) The first condition of payment of duty of the differential duty in full is waived; ii) The second condition to furnish a bond for the full value as re-determined is retained; iii) The third condition of providing the bank guarantee is modified and it is ordered to provide the bank guarantee for an amount of ₹ 5.00 lakhs only. Subject to fulfillment of above aforementioned modified conditions, the goods shall be released forthwith to the appellant after retaining samples, if any, required for the purpose of testing and adjudication. The appeal is allowed in part with further direction to the concerned Customs Authority to release the goods within three days on fulfillment of the modified conditions of the provisional release.

Summary

Issues:
1. Modification of terms of provisional release for imported goods declared as heavy melting scrap.
2. Allegation of misdeclaration and under-valuation by the importer.
3. Request for modification of provisional release conditions by the appellant.
4. Interpretation of the Provisional Duty Regulations, 2011.
5. Decision on the modification of conditions for provisional release.

Analysis:

1. The appellant filed an appeal seeking modification of the terms of provisional release issued by the Deputy Commissioner regarding imported goods declared as heavy melting scrap. The Revenue alleged misdeclaration and under-valuation by the appellant, proposing an enhanced value of the goods. The appellant contended that they purchased the goods on High Seas Sale and declared them based on import documents, denying any mala-fide intent.

2. The appellant self-assessed and paid the duty, but the Revenue suspected the imported goods to be secondhand and used pipes, including cut and full-length pipes. The Revenue reclassified the goods and proposed a higher value. The appellant, a regular importer of old and used pipes for re-melting, requested modification of the provisional release terms, citing previous clearances without objection.

3. The learned counsel for the appellant argued for the modification of the provisional release conditions, emphasizing the appellant's history of importing similar materials without issues. The Assistant Commissioner relied on the terms of provisional release and the Provisional Duty Regulations, 2011.

4. After considering the submissions, the Member (Judicial) found the conditions for provisional release to be excessive and modified them. The requirement to pay the full differential duty was waived, while the bond for the re-determined value was retained. The condition for a bank guarantee was reduced to an amount of ?5.00 lakhs.

5. The judgment allowed the appeal in part, directing the Customs Authority to release the goods to the appellant within three days upon fulfilling the modified conditions. The miscellaneous application was also disposed of, with the order to be given 'Dasti,' indicating a physical copy for immediate release.

This comprehensive analysis highlights the key issues, arguments presented, legal interpretations, and the final decision made by the Appellate Tribunal CESTAT ALLAHABAD regarding the modification of terms for provisional release of imported goods.