2023 (4) TMI 1034 - AT - Customs

Fraudulent availment of benefit of Duty Drawback - export of sub-standard readymade garments (RMG) at highly overvalued price - basis to arrive at the conclusion of overvaluation exists or not - relied upon documents not provided to appellant - opportunity of cross-examination also not provided - violation of principles of natural justice - value determined only on visual examination - levy of penalty u/s 114 and 114AA of the Customs Act, 1962. HELD THAT - In fact from the Order-in-Original it appears that the appellant had not appeared during the personal hearing on 23.05.2018 and on 19.06.2018 also requested for next date of hearing, whereby he was granted another opportunity of personal hearing on 18.07.2018 but even on that date none appeared on behalf of the appellant. It also appears from the record that the appellant had not submitted any reply to the show cause notice. However, learned Authorised Representative and also the Counsel for the appellant agreed that the matter could be remanded back to the adjudicating authority for denovo proceedings, so that the appellant gets an opportunity to cross-examine Sh. Rohit Gupta, and also submit the documents as called for by the Department. The present appeal is allowed by way of remand to the adjudicating authority to decide the issue afresh by granting an opportunity to both sides to submit the documents and cross-examine Mr. Rohit Gupta.

Summary

Issues involved:
The issues involved in the judgment are the challenge to the Order-in-Appeal rejecting the appeal filed by the appellant, the valuation of export goods, the seizure and confiscation of goods, the penalty imposed under the Customs Act, and the opportunity for the appellant to present evidence and cross-examine witnesses.

Valuation of Export Goods:
The appellant, M/s S. R. Import Export, challenged the rejection of the declared value of the export goods under Rule 8 of the Customs Valuations Rules. The authorities determined the value of the goods by calculating the local market value through a manufacturer and adding overhead and profit margin. The appellant contended that there was no basis for overvaluation and raised objections regarding the lack of opportunity to cross-examine the witness whose evidence was relied upon. The Tribunal agreed to remand the case for fresh consideration, allowing both parties to present documents and cross-examine the witness.

Seizure and Confiscation of Goods:
The export consignments of the appellant were held at ICD, Tughlakabad, New Delhi, based on intelligence received by the Directorate of Revenue Intelligence. Samples of the goods were found to be sub-standard, leading to the seizure of the goods and rejection of the declared value. The appellant was asked to provide various details, but failed to do so. The authorities issued a show cause notice, confirmed the demand, and imposed penalties under the Customs Act. The Tribunal acknowledged the appellant's concerns regarding the legality of the seizure and confiscation proceedings, and ordered a remand for further consideration.

Penalty Imposed under the Customs Act:
The appellant contested the penalties imposed under Sections 114 and 114AA of the Customs Act, arguing that there was no evidence to support the valuation and challenging the legality of the proceedings. The Tribunal noted the lack of response from the appellant to summons and show cause notices, but agreed with the suggestion to remand the case for a fresh adjudication. Both parties were granted the opportunity to submit documents and cross-examine witnesses, ensuring a fair consideration of the matter in the interest of justice.