2024 (5) TMI 575 - AT - Customs

Mis-declaration of quantity - Assorted spectacle - Demand of duty - Confiscation of goods - Penalties u/s 112A and 114AA - expensive brands with pricing of finish glasses - HELD THAT - As against declared quantity of 1056 frames, the actual quantity found was 1075 frames. It is also a fact that the brand imported by the appellant are OSIRIS, ECO and EPI which are very expensive brands with pricing of finish glasses ranging upwards of 180 dollars per piece. In these circumstances, the declared price of USD 1.25 per piece is obviously incorrect. The order in original clearly records that no contemporaneous import data of identical or similar goods was available and therefore adoption of rule 4 or 5 of the customs valuation rules was not possible. The order also records that the show cause notice proposes the deductive value method in terms of rule 7 of the said rules. However, there was issue with respect to said method as well as the market price of complete glasses were available but separate prices of mere frames were not available. In those circumstances, the revenue took assistance of chartered engineer. The appellant was kept in loop after appointment of chartered engineer and the chartered engineer after due study came to conclusion that the value of goods was Rs.11,43,420/-. Thus, there was a mis-declaration of quantity and therefore goods are as it is liable to confiscation under 111 (m) and of the Customs Act, 1962. We find that in this circumstances the imposition of redemption fine of Rs. 1,00,000/- and penalty u/s 112 A of Rs.75,000/- and under 114 AA of Rs. 1,00,00/- is not excessive or unreasonable. Thus, we do not find any merit in the appeal the same is dismissed.

Issues involved: Confirmation of demand of customs duty, confiscation of goods, imposition of penalties u/s 112A and 114AA of the Customs Act, 1962.

Summary:

Confirmation of Demand of Customs Duty and Confiscation of Goods:
The appeal was filed against the confirmation of demand of customs duty and confiscation of goods imported by the appellant. The goods were initially classified under tariff item 90031900 but were found to be assorted spectacle frames of expensive brands like 'OSIRIS', 'ECO', and 'EPI'. The declared value of USD 1.25 per piece was significantly lower than the actual market prices of USD 199 to USD 249 per piece. The actual quantity of imported frames was also found to be higher than declared. The goods were seized under section 110 of the Customs Act, 1962 due to incorrect declaration.

Valuation of Goods and Imposition of Penalties:
The appellant argued that the retail price of the goods in India should not be adopted for valuation under section 14 of the Customs Act, 1962. The appellant also contended that the declared value should be accepted as transaction value if other valuation rules do not apply. The revenue relied on a Chartered Engineer's certificate to determine the value of the goods, which was contested by the appellant as baseless. The Tribunal noted the misdeclaration of quantity and the expensive nature of the imported brands, leading to the conclusion that the declared price was incorrect. The goods were held liable for confiscation under section 111(m) of the Customs Act, 1962. The imposition of redemption fine and penalties under sections 112A and 114AA was deemed not excessive.

Conclusion:
After considering the submissions, the Tribunal found no merit in the appeal and dismissed it. The imposition of penalties and confiscation of goods were upheld based on the misdeclaration of quantity and the discrepancy in the declared value compared to the actual market prices of the imported goods.

Separate Judgement: No separate judgement was delivered in this case.

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