1994 (9) TMI 153 - AT - Customs

Summary

Issues Involved:

1. Misdeclaration and under-invoicing of imported goods.
2. Validity of import licenses.
3. Confiscation of goods and imposition of penalties.
4. Request for re-export of goods.

Detailed Analysis:

1. Misdeclaration and Under-invoicing of Imported Goods:

The appellants, M/s. Supreme Electronics (SE) and M/s. Caditronics (CAD), imported parts of VCRs from Singapore. The examination revealed discrepancies in the description, under-invoicing, and misdeclaration of the goods. The invoices lacked full descriptions and manufacturer details. The goods were found to be undervalued based on comparisons with contemporary imports and expert advice. The adjudicating authority determined that the goods were wrongly described and undervalued to evade customs duty. The Tribunal upheld the rejection of the declared prices, agreeing that the valuation was correctly determined under Rule 8 of the Customs Valuation Rules, 1988, using the best possible information available.

2. Validity of Import Licenses:

The imports were found unauthorized as both SE and CAD were not engaged in the manufacture of VCRs and lacked valid import licenses. The appellants argued that the licenses covered the imported goods, relying on various legal precedents. However, the adjudicating authority found that the assemblies/sub-assemblies being restricted items could not be permitted against REP licenses. The Tribunal agreed, finding no infirmity in the order regarding the licensing angle.

3. Confiscation of Goods and Imposition of Penalties:

The Collector of Customs ordered the confiscation of the goods, re-determination of the assessable value, and imposed redemption fines and penalties. The appellants contested these findings, arguing that the evidence was not fully considered. The Tribunal, however, upheld the confiscation and penalties, agreeing that the goods were liable for confiscation and the importers for penalties due to the contraventions of law. The Tribunal also considered the appellants' request for re-export but maintained the penalties and fines imposed by the adjudicating authority.

4. Request for Re-export of Goods:

The appellants requested re-export of the goods, citing a steep fall in market prices and the potential loss of foreign exchange. The goods had been provisionally warehoused and not cleared. The Tribunal noted that while the request for re-export merits acceptance, it must be subject to suitable fines and penalties due to the contraventions. The majority order allowed re-export of the goods with conditions: M/s. Caditronics to pay a fine of Rs. 2.50 lakhs and a penalty of Rs. 1.25 lakhs, and M/s. Supreme Electronics to pay a fine of Rs. 1 lakh and a penalty of Rs. 50,000/-.

Separate Judgments:

S.L. Peeran, Member (J):

Disagreed with the re-export request, citing inconsistencies in the appellants' claims about payment for the goods. Reduced the redemption fines and penalties due to the long detention and rapid obsolescence of electronic items.

P.K. Kapoor, Member (T):

Agreed with the findings of Member (J) and supported the reduction in fines and penalties.

Final Order:

The appeals were rejected subject to modifications in fines and penalties as indicated in para 19.