2017 (5) TMI 860 - AT - Customs

Misdeclaration of goods - undervaluation - import of artificial leather shoes for gents and ladies - the supplier had sent branded goods which were not declared and the assessable value as also the MRP declared in the Bill of Entry cannot be accepted to be correct reflection of the facts - Confiscation - redemption fine - penalty - Held that - As regards the valuation, we note that admittedly the goods were mis-declared i.e. instead of branded items, the same were declared as artificial leather shoe items. It is a fact of common sense that the branded goods are priced much more than the local non-leather Chinese shoes. As such, the value of the goods declared by the assessee would definitely be on the lower side. Redemption fine - Held that - there is nothing on record to show the MOP of the goods. As such at this stage by taking into consideration the differential duty confirmed against the assessee we reduce the redemption fine to the extent of differential duty. Penalty - Held that - the same has already been fixed on the lower side and does not require any interference. Appeal rejected - decided in favor of appellant as regards reduction in quantum of redemption fine - other matters decided against appellant.

Summary

Issues: Mis-declaration of goods, valuation of imported goods, confiscation of goods, imposition of penalty, reduction of redemption fine

Mis-declaration of goods:
The appellant imported artificial leather shoes but also received branded shoes like Nike and Adidas, which were not declared. The authorities found the declared value to be inaccurate due to the mis-declaration of the brand of goods. The value was enhanced based on contemporaneous imports, leading to a differential duty and confiscation of goods with an option for redemption on payment of a fine. The appellant argued that the branded goods were sent by mistake by the supplier, but the tribunal found no evidence to support this claim. The tribunal noted that branded goods are priced higher than unbranded items, indicating a mis-declaration in the valuation. The tribunal upheld the value adopted by the lower authorities due to the lack of evidence supporting the correct value of the consignment.

Valuation of imported goods:
The tribunal considered the mis-declaration of goods, where branded items were declared as artificial leather shoes, leading to a lower declared value. The appellant failed to provide evidence to establish the correct value of the consignment. The tribunal concluded that the declared value was on the lower side, considering the pricing difference between branded and non-branded goods. Despite the appellant paying the duty, fine, and penalty, the tribunal upheld the valuation determined by the authorities.

Confiscation of goods and imposition of penalty:
The authorities confiscated the goods and imposed a redemption fine along with a penalty under the Customs Act. The appellant requested a reduction in the redemption fine, arguing that it should align with the extent of the differential duty. The tribunal agreed that the redemption fine should be reduced to match the differential duty amount, as there was no evidence regarding the margin of profit. The penalty imposed was considered appropriate and did not require any modification. The appeal was rejected except for the reduction in the redemption fine based on the confirmed differential duty.

This detailed analysis of the judgment addresses the issues of mis-declaration of goods, valuation of imported goods, confiscation of goods, imposition of penalty, and the reduction of the redemption fine, providing a comprehensive overview of the tribunal's decision in the case.