2017 (2) TMI 872 - AT - Customs

Waiver of pre-deposit, interest and penalty - under valuation - import of Polyester Spun Yarn - Held that - the demand of duty has been confirmed against the applicant on account of e-mails/documents recovered from other importers of similar goods. No incriminating documents were recovered from the premises of the applicants and the DRI alert was also issued after importing the impugned goods - prima-facie the charge of under valuation is not sustainable against the applicants, therefore, the applicants made out a case for the complete waiver of pre-deposit - the pre-deposit of entire amount of duty along with interest and various penalties imposed on both the applicants waived - goods to be released - appeal allowed - decided in favor of applicants.

Summary

Issues:
Seeking waiver of pre-deposit of demand of custom duty, interest, and penalties due to alleged under valuation of imported goods.

Analysis:
The case involved the applicants importing Polyester Spun Yarn from China and declaring the goods as per the invoices. Subsequently, a DRI alert was issued based on investigations at other importers' premises in Ahmedabad, alleging under valuation by the applicants. The duty was demanded on this basis, leading to the appeal before the tribunal.

The counsel for the applicants argued that no incriminating documents were found at their premises, and the case was solely based on e-mails/documents from other importers and the DRI alert issued after the goods were imported. Reference was made to a tribunal decision to support the argument that the alert could not be a basis for under valuation charges. Samples drawn during investigation were found to match the applicants' declarations, indicating no misdeclaration of goods. The counsel requested release of goods and waiver of pre-deposit.

On the contrary, the A.R. supported the impugned order, citing the DRI alert as evidence of under valuation. After hearing both parties, the tribunal noted that no incriminating documents were found at the applicants' premises, and the DRI alert was issued post-import. Consequently, the charge of under valuation was deemed unsustainable, leading to a complete waiver of pre-deposit of duty, interest, and penalties. The impugned goods were ordered to be released, with the applicants undertaking to pay any duty or redemption fine if deemed necessary at the final hearing stage of the appeals.