2009 (7) TMI 146 - AT - Customs

Overvaluation to claim higher drawback / DEPB - the export consignments which were to be exported under DEPB claim or drawback claim had been brought on the basis of carting order/issued by the Dy. Commissioner much before the filing of the Shipping Bill and there is no dispute about the fact that the invoices and the packing lists presented to the Customs at the time of obtaining carting order mentioned much inflated quantity and value of the goods and in some cases, description of the goods was also different. - There is no explanation as to why at the time of obtaining carting order, the invoices mentioning much higher quantity and value had been presented. - We, therefore, hold that the provisions of Sections 113 and 114 of Customs Act, 1962 are attracted to this case and the goods have been rightly confiscated and penalties have been rightly imposed

Issues Involved:
1. Misdeclaration of quantity and value of goods.
2. Applicability of Sections 113 and 114 of the Customs Act, 1962.
3. Validity of penalties imposed under Section 114(iii).
4. Whether the act constitutes an "attempt to export improperly."

Detailed Analysis:

1. Misdeclaration of Quantity and Value of Goods:
The case revolves around the export consignments of five firms, which were found to have discrepancies between the declared and actual quantities and values of hand tools. The consignments were brought into the customs area based on carting orders issued by the Deputy Commissioner (Customs), but the shipping bills were filed later. Upon examination, the quantity and value of the goods were significantly less than those declared in the invoices and packing lists. In some cases, the description of the goods was also different. The Tribunal found that the exporters had filed shipping bills with correct quantities and values only after being alerted, indicating an attempt to cover up the initial misdeclaration.

2. Applicability of Sections 113 and 114 of the Customs Act, 1962:
The Tribunal examined whether the actions of the exporters attracted the provisions of Sections 113 and 114 of the Customs Act, 1962. Section 113 deals with the confiscation of goods attempted to be improperly exported, while Section 114 pertains to penalties for such attempts. The Tribunal noted that the exporters had initially presented invoices with inflated quantities and values to obtain carting orders and later filed shipping bills with correct details to cover up their attempt to claim higher DEPB benefits. The Tribunal concluded that the actions of the exporters constituted an attempt to export goods by misdeclaring their quantity, description, and value, thereby attracting the provisions of Sections 113 and 114.

3. Validity of Penalties Imposed Under Section 114(iii):
The appellants argued that penalties under Section 114(iii) could only be imposed if the goods had been exported under the drawback scheme. They contended that since the consignments were under the DEPB scheme, Section 114(iii) was not applicable. The Tribunal rejected this argument, stating that the misdeclaration of quantity and value, regardless of the export scheme, attracted the provisions of Sections 113 and 114. The Tribunal upheld the penalties imposed on the appellants under Section 114(iii).

4. Whether the Act Constitutes an "Attempt to Export Improperly":
The Tribunal referred to the Supreme Court's judgment in the case of State v. Mohd. Yakub & Others, which held that an attempt to commit an offence includes any act done towards its commission, even if not the final act. The Tribunal found that the exporters had brought the goods into the customs area with inflated quantities and values, intending to clear them without customs examination by forging signatures and affixing fake seals. This constituted an attempt to export the goods improperly. The Tribunal concluded that the actions of the exporters met the criteria for an attempt to export improperly, as defined by the Supreme Court, and upheld the confiscation of goods and imposition of penalties.

Conclusion:
The Tribunal dismissed the appeals, holding that the exporters' actions constituted an attempt to export goods by misdeclaring their quantity, description, and value. The provisions of Sections 113 and 114 of the Customs Act, 1962, were applicable, and the penalties imposed under Section 114(iii) were valid. The Tribunal found no infirmity in the impugned order and upheld the confiscation of goods and imposition of penalties.

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