2024 (5) TMI 284 - AT - Customs

Imports Of Marble slabs - Mis-declaration of quantity in the declared goods - demand of duty - Confiscation - Penalty - Validity Of Order-in-original passed without grant of personal hearing - No show cause notice was issued as the appellant had requested in writing - HELD THAT - We find that the appellant had declared the total quantity measured as per punchnama was more than double the quantity declared. The appellant had declared the total quantity of 2199 Sq. Mtr. whereas as per punchnama the total quantity found was 4516.031 Sq. Mtr. The business of the appellant is largely based on the method of measurement. The punchnama records that the measurement was taken by Inspector using a measuring tape. The annexure B to Punchnama indicates that the measurements have been taken in the unit of Millimetre of length and height. The number of pieces have been counted and from the length height and number of pieces the total square meter is measured. The argument of the appellant is that the officers were not experts in measuring marbles as it needs technical expertise. It has been argued that without unloading the slabs the marble could not have been measured. On the strength of these arguments learned counsel has sought to discard the annexure-B to the punchnama which contains the measurements of the slabs and the number of units. In this case no show cause notice was issued as the appellant had requested vide letter dated 02.03.2017 for release of seized goods immediately without issue of show cause notice and without holding personal hearing. The importer had indicated that he is ready to pay up duty fine and penalty imposed in this regard. Consequently the order-in-original was passed without grant of personal hearing. We find that the Principal Bench in the case of Vikas Spinners 2000 (11) TMI 196 - CEGAT COURT NO. IV NEW DELHI has observed that once the assessee accepts the objection raised at the time of assessment without demur he cannot later challenge assessment. Thus it is seen that the goods were taken by the importer without any protest. The method of measurement was not challenged before clearance of goods.In these circumstances the impugned order demanding duty interest and confiscation cannot be faulted. However the redemption fine is reduced from Rs. 15 lakhs to Rs. 5 lakhs and penalty is reduced from Rs. 2 lakhs to Rs. 50, 000/- only. Appeal is partly allowed in above terms.

Issues Involved:
1. Confiscation of imported goods u/s 111(m) of the Customs Act, 1962.
2. Imposition of penalty u/s 11(a) of the Customs Act, 1962.
3. Demand of customs duty based on revised quantity.
4. Validity of measurements taken by customs authorities.
5. Absence of show cause notice and personal hearing.

Summary:

Confiscation of Imported Goods u/s 111(m) of the Customs Act, 1962:

The appellant, M/s Mahi Marble, imported marble slabs and declared a total quantity of 2199 Sq. Mtr. However, upon examination under a punchnama, the actual quantity measured was 4516.031 Sq. Mtr. The customs authorities concluded that the declared quantity was incorrect and invoked section 111(m) of the Customs Act, 1962 for confiscation of goods.

Imposition of Penalty u/s 11(a) of the Customs Act, 1962:

Due to the mis-declaration, the customs authorities imposed a penalty under Section 11(a) of the Customs Act, 1962. Additionally, a redemption fine amounting to Rs. 15 lakhs was imposed.

Demand of Customs Duty Based on Revised Quantity:

The demand of duty was made on the revised quantity as per the Punchnama of the Revenue. The appellant argued that the physical verification of imported goods was not conducted by industry experts, and the measurement should have been done by an expert of the industry.

Validity of Measurements Taken by Customs Authorities:

The appellant contended that the measurement of marble slabs requires technical expertise and should have been done by industry experts. The Tribunal noted that the measurement was taken by an Inspector using a measuring tape, and the measurements were recorded in millimeters of length and height. The Tribunal found that the method of measurement was not challenged before the clearance of goods.

Absence of Show Cause Notice and Personal Hearing:

No show cause notice was issued as the appellant had requested for the immediate release of seized goods without a show cause notice and personal hearing. The Tribunal referred to the case of Vikas Spinners, where it was observed that once the assessee accepts the objection raised at the time of assessment without demur, he cannot later challenge the assessment. Similarly, in the case of Aggarwal Traders, it was held that if the appellant expressly consents to the value proposed by the Revenue and foregoes the need for a show cause notice, the consented value becomes the declared transaction value requiring no further investigation or justification.

Conclusion:

The Tribunal upheld the confiscation of goods, demand of duty, and imposition of penalty. However, considering the facts of the case, the redemption fine was reduced from Rs. 15 lakhs to Rs. 5 lakhs, and the penalty was reduced from Rs. 2 lakhs to Rs. 50,000/-. The appeal was partly allowed in these terms.

(Order pronounced in the open court on 02.05.2024)

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