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Issues:
Challenge to market value determination, confiscability of goods, levy of penalty. Analysis: 1. Market Value Determination: The appeal challenged the Commissioner's decision on the market value of 2500 woollen leggings exported to Russia. The appellant contended that the determination was flawed as it disregarded relevant evidence, relied on unreliable sources, and failed to consider the purchase invoice provided by the appellant. The appellant argued that opinions from two dealers were given undue weight, despite lacking credibility. The Circular No. 69/97-Cus. guidelines were cited, emphasizing the importance of considering sale invoices for market value determination. The Tribunal agreed, criticizing the investigation for not following proper procedures and found no justification for rejecting the purchase invoice. The Tribunal concluded that the evidence from the dealers was insufficient and overturned the market value determination. 2. Confiscability of Goods: The Customs Authorities had initiated proceedings against the appellant for misdeclaration of the market value, leading to the confiscation of goods under Section 113(i) of the Customs Act, 1962, and imposition of a penalty under Section 114(ii). The appellant argued that there was no violation of the Customs Act and that confiscation and penalties were unjustified. The Tribunal concurred, stating that no violations were proven, and the confiscation and penalties were unwarranted. The Tribunal highlighted the lack of evidence supporting the authorities' actions and ruled in favor of the appellant. 3. Levy of Penalty: The appellant contested the penalty imposed under Section 114(ii) of the Customs Act, arguing that penal action was not warranted if the declared market value was not accepted. The Tribunal agreed, emphasizing that penal action was not justified in the absence of Customs Act violations. The penalty was deemed unjustified, and the Tribunal allowed the appeal, providing consequential relief to the appellants by granting DEPB benefits based on the declared FOB and market values. The impugned order was set aside due to lack of evidence and legal sustainability. In summary, the Tribunal overturned the Commissioner's decision on market value determination, confiscability of goods, and the levy of penalties, citing procedural errors, lack of credible evidence, and absence of Customs Act violations. The appeal was allowed, granting relief to the appellants and upholding their entitlement to DEPB benefits based on the declared values.
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