2000 (9) TMI 94 - AT - Customs

Summary

Issues Involved:
1. Misclassification of goods.
2. Overvaluation of goods.
3. Eligibility for DEPB benefits.
4. Provisional export permission.
5. Liability of Customs House Agent (CHA).

Summary:

Misclassification of Goods:
The exporters classified the goods under ITC Code No. 9101, while the Department argued they should be under ITC Code No. 9102. The exporters contended that ITC Code No. 9101 was applicable to their goods, which were gold-polished. The adjudicating authority rejected the exporters' claim and held that the misclassification amounted to misdeclaration.

Overvaluation of Goods:
The Department alleged that the exporters overvalued the goods to avail higher DEPB benefits. The adjudicating authority relied on certificates from AIEWCM Association and a certified goldsmith, which were found unreliable as the market enquiry was conducted without the exporters' presence, dismantling the goods and destroying their identity. The Tribunal found no material discrepancy in the declared value and held that the Department's basis for valuation was unsustainable.

Eligibility for DEPB Benefits:
The exporters claimed DEPB benefits for Quartz analog watches under the DEPB scheme. The Department denied the benefits, arguing that the gold value could not be included. The Tribunal found that Quartz analog watches were covered under the DEPB scheme and should be valued as an integrated unit, including the gold bracelets.

Provisional Export Permission:
The exporters requested provisional export permission pending departmental enquiries, which was denied by the Department. The Tribunal noted that previous exports of similar goods were cleared without objection and the Department should have allowed provisional exportation as per the Circular and Public Notice.

Liability of Customs House Agent (CHA):
The CHA was penalized for not checking the credentials of the exporters and the description of goods. The Tribunal found no material discrepancy in the documents and noted that checking credentials was not an obligation under the Customs House Agents Licensing Regulations, 1984. The penalty on the CHA was deemed unjustified.

Conclusion:
The appeals were allowed, setting aside the order of confiscation, redemption fine, and penalties. The Customs authorities were directed to release the goods within forty-five days.