2025 (1) TMI 355 - AT - Customs

Evaison of ADD - Confiscation - interest - penalty along with anti-dumping duty - misdeclaration of imported goods - Aluminum Printing Plates having one side blue in colour and other side natural aluminum colour, declared as P.S. Printing Plates (Photosensitive Printing Plate) . The basic challenge of the appellant is to the test report relying on the findings of this Tribunal in the later decision in Sun N Sand 2024 (10) TMI 158 - CESTAT NEW DELHI , where test report was held to be not reliable as the lab was lacking proper infrastructure for CTCP machine testing and, therefore, outsourced it for testing. HELD THAT - The facts of the present case are not identical to the case of Sun N Sand in so far as the authenticity of the test report is concerned. Though in both the cases, the Government labs had refused to conduct the test due to non-availability of the infrastructure and the testing was forwarded to the private lab, i.e., M/s. Don Bosco, however, the present case is distinguishable as the testing had not been outsourced by M/s. Don Bosco and it has also not been proved by the appellant herein that M/s. Don Bosco was not fully equipped to carry out the testing of the samples. In the case of Sun N Sand, it was noted that on cross-examination of the technical expert from M/s. Don Bosco, the Commissioner (Appeals) had set aside the imposition of anti-dumping duty, whereas in the present case as noted by the original authority and as is evident from the absence of the appellant before the adjudicating authority, they have never sought for any cross-examination of the technical experts of M/s Don Bosco and in that view, the contention raised by the appellant that they have not been granted any opportunity of cross examination is unsustainable. Hence, the findings of the Tribunal in Sun N Sand are not applicable in the present case and no fault can be attributed to the test report. The fact cannot be ignored that as per the procedure for drawing the samples, one sample is given to the aggrieved party, i.e. the appellant herein and the appellant had an option to get the retesting done through the sample given to him, however, they refrained from exercising this right. On the issue, that the test was conducted after the expiry period of 18 months and therefore, the test report cannot be relied upon has been rightly rejected by the adjudicating authority as the testing agency has no way stated in the test report that the shelf life of the Plates had expired. Nor the appellant had produced any evidence from the supplier about the shelf life of the plates. Considering that the invoice of the goods is dated 18.04.2015 and hence they could have been manufactured sometime before the said date, the samples drawn from the consignment on 03.11.2015 were initially forwarded to the Government lab on 19.11.2015 but due to the unforeseen circumstances, the samples were finally sent on 14.12.2017 and soon, thereafter, the test report was made on 30.03.2017 - Since only the date of invoice as 18.04.2015 is available, the delay, if any, is not really very material as it would not change the nature and characteristics of the goods. The declared goods, as P.S. Plates, would remain the same even on the expiry of eighteen months and would not convert to CTCP Printing Plates. The simple illustration is, that if a food item, for example, bread which normally comes with the specification, Best before say 15th January 2025, if tested anytime after the said date would not convert into Roti . The bread would remain bread and infact, is edible for a few days later even after the expiry date. Therefore, the argument of the learned counsel that expired goods no way reflect its authentic and correct characteristics on testing has no merit and is unsustainable. Conclusion - The test report by Don Bosco was not faulty and relying on the same the authorities below have rightly held that the subject goods have been mis-declared by the appellant as Aluminium P.S. Printing Plates so as to evade the imposition of anti-dumping duty under the notification no. 51/2012-CUS(ADD) dated 03.12.2012. The appellant having given wrong description have violated the provisions of section 46(4) of the Act as such the goods are liable for confiscation under section 111 (m) of the Act. Consequently, the appellant is liable to pay the anti-dumping duty of Rs. 44,15,360/- along with the penalty of the same amount under section 114 (A) of the Act. Appeal dismissed.

Summary

1. ISSUES PRESENTED and CONSIDERED

The core legal questions considered in this judgment include:

• Whether the test report from Don Bosco Technical Institute is reliable for determining the nature of the imported goods.
• Whether the appellant's goods were correctly classified under the Customs Tariff and subject to anti-dumping duty as per Notification No. 51/2012-CUS (ADD).
• Whether the goods were liable for confiscation under section 111(m) of the Customs Act, 1962 due to mis-declaration.
• Whether the penalties imposed on the appellant under section 114A of the Customs Act were justified.

2. ISSUE-WISE DETAILED ANALYSIS

Issue 1: Reliability of the Test Report

• Relevant legal framework and precedents: The Customs Act, 1962 provides for testing of imported goods to verify their classification and applicability of duties. The appellant challenged the reliability of the test report from Don Bosco Technical Institute, arguing it lacked proper testing facilities.
• Court's interpretation and reasoning: The court found that the appellant did not provide evidence that Don Bosco was unequipped for testing. The appellant also failed to request a retest or cross-examination of the technical expert, which undermined their challenge to the report's reliability.
• Key evidence and findings: The test report indicated the goods were CTCP printing plates, subject to anti-dumping duty. The court noted the appellant's signature on the test memo, suggesting consent for the testing process.
• Application of law to facts: The court applied the Customs Act provisions, emphasizing the appellant's failure to substantiate claims against the test report's validity.
• Treatment of competing arguments: The appellant's reliance on precedents like Sun N Sand Exim was dismissed as the factual circumstances differed, particularly regarding the testing process.
• Conclusions: The test report was deemed reliable, and the appellant's objections were rejected.

Issue 2: Classification and Anti-Dumping Duty

• Relevant legal framework and precedents: Notification No. 51/2012-CUS (ADD) mandates anti-dumping duty on certain printing plates from China. The appellant contested the classification of their goods as CTCP plates.
• Court's interpretation and reasoning: The court upheld the classification based on the test report, which identified the goods as CTCP plates, thus subject to the notified anti-dumping duty.
• Key evidence and findings: The test report and the appellant's failure to provide contrary evidence supported the classification.
• Application of law to facts: The court applied the notification's provisions, affirming the duty's applicability due to the goods' classification.
• Treatment of competing arguments: The appellant's arguments about the goods' nature post-expiry were dismissed as irrelevant to their classification.
• Conclusions: The goods were correctly classified, and the anti-dumping duty was applicable.

Issue 3: Confiscation under Section 111(m)

• Relevant legal framework and precedents: Section 111(m) of the Customs Act allows confiscation for mis-declaration of goods.
• Court's interpretation and reasoning: The court found the appellant mis-declared the goods to evade anti-dumping duty, warranting confiscation.
• Key evidence and findings: The mis-declaration was evidenced by the test report and lack of contrary evidence from the appellant.
• Application of law to facts: The court applied section 111(m), affirming the goods' liability for confiscation due to mis-declaration.
• Treatment of competing arguments: The appellant's objections were unsupported by evidence, leading to their rejection.
• Conclusions: The confiscation of goods was justified under section 111(m).

Issue 4: Penalties under Section 114A

• Relevant legal framework and precedents: Section 114A of the Customs Act imposes penalties for duty evasion through mis-declaration.
• Court's interpretation and reasoning: The court upheld the penalties, citing the appellant's mis-declaration and failure to contest the findings effectively.
• Key evidence and findings: The evidence of mis-declaration and the appellant's non-compliance with procedural opportunities justified the penalties.
• Application of law to facts: The court applied section 114A, affirming the penalties based on the appellant's actions and omissions.
• Treatment of competing arguments: The appellant's arguments lacked evidentiary support, leading to their dismissal.
• Conclusions: The penalties under section 114A were upheld as justified.

3. SIGNIFICANT HOLDINGS

• Preserve verbatim quotes of crucial legal reasoning: "The appellant cannot dictate the terms to the testing agency or the Department to have the test conducted by adopting a particular method as per their choice."
• Core principles established: The reliability of test reports is contingent on procedural compliance and the absence of contrary evidence. Mis-declaration warrants confiscation and penalties.
• Final determinations on each issue: The court affirmed the reliability of the test report, the classification of goods, the application of anti-dumping duty, the confiscation under section 111(m), and the penalties under section 114A, leading to the dismissal of the appeal.