2000 (8) TMI 141 - AT - Customs

Summary

Issues:
1. Mis-declaration of exported products regarding chemical composition.
2. Confiscation of export products and imposition of penalties.
3. Time-barred show cause notice.
4. Vagueness in test reports and request for re-testing.
5. Denial of re-testing by the Commissioner of Customs.
6. Violation of principles of natural justice.

Analysis:
1. The Commissioner of Customs held that the appellants mis-declared the exported products concerning their chemical composition, leading to an order for confiscation of the export products and imposition of penalties under Section 114 of the Customs Act, 1962. The goods were not available for confiscation as they had already been exported against an ETC Bond and Bank guarantee.

2. The appellants, engaged in manufacturing stainless steel utensils, exported 30 consignments declared to be of AISI-304 grade. However, test reports revealed that the stainless steel used did not conform to AISI-304 specifications. The appellants argued that the show cause notice issued was time-barred as it was beyond six months from the date of receipt of the test reports.

3. The samples were tested by the Deputy Chief Chemist, Kandla, and the National Test House, Mumbai. The appellants contended that the test reports were vague and requested re-testing, which was denied. The Tribunal found that denial of re-testing amounted to a violation of principles of natural justice, as established in a previous case.

4. The test reports were criticized for being vague and not providing sufficient reasoning for the conclusions drawn. The National Test House report only examined 5 parameters instead of the required 7 for testing stainless steel of AISI-304 grade. The denial of the request for re-testing was considered unjustified, given the circumstances and the previous Tribunal ruling.

5. The Commissioner of Customs denied the request for re-testing on the grounds of no valid reason being provided and the request being based on flimsy grounds. However, the Tribunal concluded that the request for re-testing was not unfounded and that declining it amounted to a violation of natural justice principles.

6. Ultimately, the Tribunal set aside the impugned order, allowing the appeal due to the denial of the request for re-testing being deemed a violation of natural justice. The decision highlighted the importance of fair procedures and thorough examination in customs cases, ensuring justice and procedural correctness.