1988 (3) TMI 195 - AT - Central Excise

Summary

Issues:
1. Violation of Import Trade Control regulations
2. Mis-declaration of value of imported goods
3. Customs tariff classification of goods
4. Reduction in fine and penalty amounts

Analysis:

1. Violation of Import Trade Control regulations:
The appellant imported PVC sheets but faced objections from the lower authority for violating Import Trade Control regulations on two grounds. Firstly, the goods were PVC floor coverings with a thickness exceeding the allowable limit. Secondly, the appellant claimed to have purchased the goods from a stock lot, which was considered disposal goods not permitted for import without specific authorization. However, the Tribunal found that the appellant's import license was issued before the relevant Import Trade Control Public Notice, making the subsequent restriction inapplicable. Additionally, a Bombay High Court ruling clarified that "disposal" goods referred to second-hand goods, not applicable in this case. Therefore, the Tribunal ruled in favor of the appellant, concluding no violation of Import Trade Control regulations.

2. Mis-declaration of value of imported goods:
Regarding the valuation aspect, discrepancies arose in the declared value of the imported PVC sheets. The appellant submitted an invoice showing a lower value compared to the insurance policy for the same consignment. Further investigation revealed that the goods were actually purchased at a higher price, indicating misdeclaration by the appellant. Despite the appellant's explanation about covering premium amounts through insurance, the Tribunal found no evidence supporting this claim. The Tribunal concluded that the lower authority's assessment of the goods' value was accurate, holding the appellant accountable for deliberate misdeclaration.

3. Customs tariff classification of goods:
The lower authority classified the goods as PVC floor coverings instead of PVC sheets based on customs tariff classifications. The appellant did not challenge this classification during the hearing, leading the Tribunal to refrain from delving into this aspect of the case.

4. Reduction in fine and penalty amounts:
Considering the appellant's detention costs and the favorable rulings on Import Trade Control issues, the Tribunal decided to reduce the fines and penalties imposed. The fine in lieu of confiscation and the penalty were both reduced to Rs. 50,000 each. Despite this reduction, the appeal was rejected, except for the adjusted fine and penalty amounts.

In conclusion, the Tribunal ruled in favor of the appellant regarding the Import Trade Control violations but held them accountable for misdeclaring the value of the imported goods. The decision included a reduction in fines and penalties due to detention costs and successful arguments on certain aspects of the case.